NEW DELHI, July 28: The Telecom Regulatory Authority of India's (TRAI) attempts to raise funds for its operations may run into rough weather with the DoT and private telecom operators raising objections to TRAI's funding plans. While the DoT says the funds required are too high, the private operators feel their contribution should be adjusted against the licence fee they pay to the Government each year.The TRAI assessment is that it will require an additional Rs 20 crore for its operations this year -- going up to Rs 26 crore next year. According to the TRAI's plan, a levy of 0.15 per cent of the gross revenues of operators will meet its funds requirement. This includes expenses to be incurred for the administrative/legal, commercial, economic, engineering/consumer, finance and accounting and research activities carried out by the TRAI. The attempt to raise additional resources for the TRAI apart from the Government allocated funds are being dubbed as an important means of increasing the "independence" ofthe regulator.
Apart from DoT and the private telecom operators, others from whom the funds are to be raised are Mahanagar Telephone Nigam Ltd (MTNL) and the Videsh Sanchar Nigam Ltd (VSNL).
The matter assumes significance as the TRAI being the first regulator of its kind, any trends set up by it will have far-reaching implications for other regulatory bodies in the power, insurance and surface transport sectors.Under the TRAI Act of 1997, the Authority under section 11 is authorised to levy fees and charges on service providing companies for carrying out its various functions. In fact, the Ministry of Finance has also been pushing the TRAI to meet its expenditure by raising their own resources.
The TRAI had proposed that the based on the annual revenue calculations of the service providers during 1996-97 DoT with a gross revenue of Rs 11,000 crore, MTNL with Rs 4,000 crore and VSNL with Rs 5,000 crore and Rs 900 crore revenue generated by all cellular operators put together (basic services yet toyield any revenues) -- a uniform levy of 0.15 per cent would yield Rs 27 to Rs 28 crore -- the amount the TRAI would expect to incur as costs during the next year.
Private operators have suggested that the levy be charged on the basis of revenue generated out of charges like activation, subscription, monthly rental and air-time rather than including the revenue operators received from sale of handsets -- which are sold by operators on the cost they obtain from cell phone manufacturers -- and PSTN charges that the operators show as revenue but eventually pay to the DoT.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
