IDFC moots uniform licence regime for telecom sector

NEW DELHI, DEC. 13. Infrastructure Development Finance Company (IDFC) today suggested a single universal licence regime for the telecom sector while encouraging mergers and acquisitions to give a fillip to competition in the sector.

``We should quickly move towards a regime of a single universal licence and find an efficient means to auction scarce resources such as spectrum bandwidth where needed," the IDFC Chairman, Mr. Deepak Parekh, said at the third international conference on `Infrastructure Development (Infranet 2000)' here.

Mr. Parekh said entry and mergers and acquisitions should be encouraged by doing away with the present asymmetric revenue shares for different services.

"The revenue share should only be limited to take care of administrative and regulatory expenses, with a separate levy for meeting the costs associated with universal service obligations," he said, adding, the present cap on foreign equity should also be removed.

In power, pace of distribution privatisation needs to be expedited as unbundling and regulation were not enough. "We seem to be wasting precious time in achieving the elusive right configuration of viable distribution zones, and in assessment of so called assets that are in fact liabilities," he said.

State governments should privatise urban and industrial areas as soon as possible to isolate theft from the overall subsidy burden, Mr. Parekh said.

Mr. Parekh said funds collected in the Central Road Fund (CRF) through the levy of Re 1 cess on petrol and diesel needed to be expeditiously spent on maintenance of roads and expanding capacities in the corridors that are most sought after by road users.

Construction contracts needed to be combined with maintenance responsibilities and project developers should be paid on the basis of the overall quality of the road service that they had contracted to provide, he said.

"For more effective prioritisation of projects, the governing body of the Central Road Fund should have a fair representation of road users," he added.

Speaking on the occasion, the Confederation of Indian Industry President, Mr. Arun Bharat Ram, said at least 50 per cent of the India Millennium Deposits (IMD) should be earmarked for infrastructure development in the country.

While expediting implementation of key infrastructure projects, renovation and maintenance of existing projects especially in power sector should be taken up on priority basis, he added.

- PTI

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