Sucheta Dalal :S.Gurumurthy on Reliance Telecom
Sucheta Dalal

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S.Gurumurthy on Reliance Telecom  

October 31, 2003

BJP ideologue and Reliance baiter, S.Gurumurthy says that Reliance has once again broken the law and manipulated policy to get away with a paltry fine.  


Legalising a fraud, the TRAI way


By S.Gurumurthy


The Telecom Regulatory Authority (TRAI) unveiled its recommendations on the telecom mess on Monday. The TRAI has virtually told the Government to legalise for a paltry penalty the fraud played by Reliance Infocom and get on with life!


Comparing the law-abiding Tatas with the law-breaking Reliance, the size of the fraud is over Rs 10,000 crores but the penalty recommended is just Rs 500 crores! Even Mukesh Ambani would be ashamed to make such a recommendation for Reliance. This calls for comment as not many in the media feel comfortable to comment on issues concerning Reliance.


Let us attempt to capture the complex fraud in simple language. By its licence terms, Reliance Infocom could only provide fixed, not mobile, telephone service. There are ten others who had paid thousands of crores as fee for mobile telephone licence. Suddenly, from nowhere, Reliance got the government –– the Vajpayee government trusted to be more honourable than its predecessors –– to approve of what was known as limited mobile service. In effect, an extended cordless phone within defined geographic limits.


Even this was a dishonest derailment of policy. But what Reliance did afterwards was an unqualified fraud. Under the guise of limited mobility, it began to sell full all-India mobile telephony. They worked through the previous Telecom Minister and even got the Prime Minister to receive the first illegal mobile call. They broke the law openly.


They advertised their breach by special campaigns like ‘Monsoon hungama’, ‘Festival galatta’, built up a subscriber base of over four millions, who are now held hostages to force the government to favour Reliance.


The government remained a mute spectator to all this. Some suspect it was even a passive collaborator. ‘‘Are they doing anything wrong at all,’’ asked the government when Reliance began the illegal service. The TRAI predictably found nothing wrong in it. So the matter went to the appellate authority on telecom, TDSAT. The TDSAT order was the first honest act of the system. It declared the mobile service provided by Reliance illegal.


Its Chairman held even the limited mobility illegal and the government action virtually malafide. He cited judicial restraint for not making a stronger indictment of the government. Now the government too accepts that the mobile service of Reliance is illegal. But instead of ordering them to stop the illegality, the government asks TRAI, the very authority that endorsed the illegality first, to advise how to implement the TDSAT order!


The TRAI took its own time and murmured, ‘‘may be Reliance has a point,’’ almost justifying the fraud again! Obviously, the government would not enforce the TDSAT order, nor tell Reliance to stop.


Here begins the efforts to validate the fraud. A new licence –– Unified licence, a hold all permit –– which will nullify the TDSAT order banning mobile service by Reliance is proposed. The Telecom Ministry welcomes it. The TRAI endorses it. Then a Group of Ministers is constituted to decide the issue.


The GoM too says Reliance mobile service is illegal. Yet the service continues. The ministry says it is illegal. Yet Reliance wouldn’t care a damn. Later, GoM decides to do precisely what Reliance wants. That is to issue a uniform licence to validate the illegal service of Reliance, but again asks TRAI to decide the terms. Yesterday, the TRAI came out with its recommendation for unified licence predictably on terms which will turn most Cellular operators bankrupt soon. Precisely the solution Reliance wanted.


From the beginning to now, the direction is clear. Not to stop Reliance from continuing its fraudulent service, but to validate it retrospectively. Reliance has replayed its time-tested strategy. First, it breaks the law so massively that enforcement becomes a problem. Then it gathers support to blame the law for defying it. Finally, it gets the support to get the law amended to legalise its defiance. In fact, it is its unique brand. So its violations are not illegal, but actually pioneering efforts to make the law perfect. But this logic has another dangerous side. It validates what a Haji Mastan or even a Dawood Ibrahim did decades ago. By smuggling in gold and showing more courageous entrepreneurship, they pioneered the changes in law on gold. They did this by testing the limits of gold control laws in a country which loves gold. Are not Haji Mastans and Dawood Ibrahims due for the same honour as Reliance?
-- Sucheta Dalal