Respected Prime minister,

I write to you in connection with the recent Announcement of a Global Auction of spectrum for 3G services by the Department of Telecommunications and a subsequent article in Economic Times dated 10th May 2007 in that connection (a copy of the article is attached.)

Firstly, I must congratulate you and the Government in taking the decision for a global auction of spectrum. I believe that is in the best National interest.

The article attached quoting one of the corporate's currently in the Telecom sector is trying to make out a tenuous case of restricting bidders for 3G on some frivolous grounds. As someone who has personal experience of various forms of arguments and logic that have been used in the past to distort what is the correct thing to do, I would like to make some points so that such lobbying does not derail the government from the right path.

That 3G is a separate service is a principle accepted all over the world. The regulator and the government here have also agreed to this principle. Therefore, there seems to be no dispute that these should be separate licenses. The key issue seems to be the commercial terms of allocating spectrum.

It is true that in the early 90s when the Government was actively trying to encourage investors and helping build out the telecom sector, the terms of spectrum were far kinder and gentler. Even there in the mid 90's and subsequently spectrum allocation or license allocation was through a global auction without any restrictions on new players.

Spectrum is clearly a valuable natural resource of the Government and people of India. When spectrum is being allocated in present day, when the telecom sector is well developed and valuable (Note the current valuations of Hutch sale to Vodafone), there is clearly no justification in allotting spectrum in any way but a transparent auction. An auction process has been used in the Telecom sector before for the 4th round of cellular licenses and as well more recently very successfully by the I & B Ministry for FM licenses.

Given that there can't be any argument against auction, a case is now sought to be made by this corporate, that the bidders must be restricted through some arbitrary criterion - in this case Indian companies or existing operators or both. This is quite ridiculous and goes against the objectives of on auction. There were no such restrictions on the 41h round of cellular licenses nor were there any restrictions like this in the recent FM licenses, Which would lead one to believe, that the only objective of the restricting bidders would be to depress the real price of spectrum being allotted.

This argument being mode must be rejected with the contempt it deserves notwithstanding the fact that it comes from a so-called reputed Indian corporate. It is against national interest and against every precedence and practice of exacting maximum value for spectrum. This suggestion IS even more ironical given the almost opposite view taken by the some company when it was trying to get into Cellular through the WLL route in the whole WLL scam not many years ago.

In short, I wish to reiterate that the decision of the Government to actively seek out through the process of a Global transparent Auction with no restrictions on participants, the best price for 3G spectrum/licenses ·is the correct one for the country and its people. This is consistent with practices in the post and in other sectors like FM. Resources raised through such a process con be invaluable in addressing rural tele-density and other investment requirements of the government in rural and urban infrastructure. The government must not allow lobbying of the kind in this reported letter to compromise this approach and to perpetuate oligopolies of the kind that you recently referred to in a speech.

I am sure, given my history of association with Telecom, there will be some accusations of me having some agenda or the other. I have none, except to make sure that the wrongs that so characterized the conduct of the Telecom policy in the post years are not repeated today or ever again in the future.

Thanking you
Very truly yours

Rajeev Chandrasekhar

Dr. Manmohan Singh
Hon'ble Prime Minister
Government of India

Copy to

Thiru Dayanidhi Maran
Hon'ble Minister of Telecommunications and IT

Thiru P Chidambaram
Hon'ble Finance Minister