3G bidding has taken sheen off Indian telecom industry: Mittal

Government raked in over Rs 1.06 lakh crore from the auction of 3G and BWA spectrum

PTI | January 27, 2012



Bharti Airtel is the country's largest telecom operator.

"It is true that we bid such crazy numbers (for 3G spectrum)... There was no 2G spectrum being allotted for years and the only way to move forward was to have the spectrum of 3G at any cost. And that is what happened," Mittal told NDTV Profit on the sidelines of the World Economic Forum (WEF) here.

"I mean we paid ridiculous amounts of money and in my opinion, the 3G bidding has taken the lights out of the industry. So the amortisation of the money that we paid for 20 years and the interest is bothering the industry," he noted.

Responding to a query whether there was fear among telecom bosses about how the new telecom policy would shape up, Mittal said there is fear the government would "overcharge this industry for getting too much money out of this industry".

"I do not think this industry has enough money left in it to give much more to the government. Especially after the 3G and the broadband wireless access or BWA spectrum auction, where Rs 1,00,000 crore had been sucked out of the telecom industry," he said.

"You will certainly see a massive increase in tariffs if the industry is going to be hit by a large amount of money and spectrum," he added.

The government raked in over Rs 1.06 lakh crore from the auction of 3G and BWA spectrum in FY2010-11.

Noting that the telecom industry has gone through a "massive upheaval", Mittal said telecom is no more the "finest story".

On the current industry view of the government, Mittal said, "First of all, I don't think there is a criticism of the government. In fact, we are out there to support the government."

Stressing that the Indian growth story is intact at the fundamental level, Mittal noted, "It is the investment side which is weak because people are not easily opening up to that extent. That also impacts the foreign investments." 

 

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