The real cost of the spectrum scam

Monday, May 21, 2012

India managed to leapfrog several generations in technology and connectivity thanks to the mobile telephony revolution. But unfortunately, technology has a habit of not allowing one to rest on one’s laurels and soak in the glory.

Thanks to the heat and dust of the spectrum scam, there is a real danger of the momentum generated by the explosive expansion of the mobile telephony sector getting dissipated in endless rounds of legal wrangling, bureaucratic obfuscation and plain political dithering.

There have been two fall-outs of the spectrum scam. One is the completely skewed perceived valuations of the so called “national resources’, which is rapidly driving pragmatism out of the window — while pushing the costs of basic essentials, such as energy or communication, rapidly beyond what is manageable for a country like ours.

The second fall-out is more insidious and damaging in the long term. The policy paralysis which has gripped governance at all levels means that critical decisions — including decisions that need to be taken today in order to maintain India’s growth momentum and competitive ability tomorrow — are simply not being taken.


Telecom itself offers a good example of both. Witness the chaos unleashed by the spectrum scam and its aftermath — the cancellation of as many as 122 licences, the decision of many serious telecom players to delay or defer their engagement in India and the virtual stoppage of all fresh investment in the sector, even by those in no danger of losing their existing licences. Spectrum has figured so much larger than life in the public sphere that even policymakers and decision-makers who ought to know better, appear to be labouring under the illusion that terrestrial wireless (space-based wireless unfortunately got derailed by the Devas imbroglio) is the only way to go.

This means that we are in real danger of missing the bus on alternative technologies for connectivity. Like fibre optics, for instance. Oh, we have a mission for optic-fibre connectivity. There is a Rs 20,000-crore plan to bring broadband connectivity to the panchayat level. There is even a national optic-fibre network in place.

But there is no real movement forward in actually extending the linkages from the backbone to the hinterland. Even where some linkages have been established, usage is abysmal — neither service providers nor consumers are plugged in.

This is a great pity. Fibre-based connectivity offers the opportunity to unlock the potential at the bottom of the pyramid, by multiplying manifold the quality and speed of connectivity.

Source: The Hindu - Business Line (link opens in a new window)