Assorted articles and Information

Mobile operators are likely to fiercely oppose the government’s move to allow only two private operators apart from BSNL/MTNL in the 3G space. On March 29, ToI reported the Telecom Commission’ (TC) intent to allow through an auction, only three operators in 3G, with an initial allocation of 10 MHz spectrum each rather than six operators with 5 MHz spectrum each. It further proposes that one of these three operators should be state-owned BSNL/MTNL, which will be required to match the highest bid placed by private operators when the auction occurs.

This development leaves at least four of the existing six operators and nearly all of the new operators without 3G spectrum, a fearful thought for companies whose valuation and growth is acutely linked to the availability of spectrum in 2G and migration to 3G.

Some of the largest operators spoke to ToI on conditions of anonymity. “The government’s 3G proposal is both flawed and totally inconsistent with its policy of open competition in the 2G arena. How can the country have upto 12 operators per circle in 2G and merely 3 operators in 3G?” they say. 5 MHz of 3G spectrum for six operators is the way to go. Even in Europe, most 3G operators did not use even 5 MHz for the longest period of time,says another players. Experts feel that a combination of 7 MHz-10 MHz in 2G with 5 MHz in 3G would be an ideal and in fact, potent combination for many operators.

Ironically, the 3G proposals in their present form carries the potential of bringing together warring parties like Vodafone, Idea and Bharti, who could join hands with Reliance, Tatas and some of the new entrants to lobby for more slots (5 MHz) than fewer (10 MHz) as is currently proposed. This is critical for them as the uncertainty over 3G spectrum forces a serious and potentially crippling review of company valuations, at least till the final winners are declared. Interestingly, the GSM association is yet to take a public stance on the TC’s latest proposal.

For the first time, the Centre’s net direct tax collections have crossed the Rs 3-lakh crore mark. To grasp the significance of this milestone, one needs to go back only 15 years or so. In 1990-91, the Centre’s net direct tax collections were about Rs 11,000 crore, which was only about one-fifth of the Centre’s entire tax kitty. This year (2007-08) was a fiscal landmark for another reason too, the net direct taxes collections account for over 50 per cent of the Centre’s revenue.

The net direct tax collections had crossed the Rs 3-lakh crore mark on 29th March, 2008. The revised estimate of about Rs 3,04,760 crore is likely to be achieved by March 31, sources added. The direct taxes had recorded over 40 per cent growth in fiscal 2007-08. As against the Budget estimate of Rs 2,67,490 crore, the direct collections have crossed Rs 3,00,000 crore, reflecting the sheer buoyancy in such taxes (corporate taxes and personal taxes).

There has clearly been a shift away from indirect taxes to the direct taxes all through the post reforms period. This is seen as progressive on two counts. Firstly, by taxing earnings of individuals and corporates rather than production and trade, there is less stifling of economic activity and employment generation. Secondly, while the poor and rich pay taxes alike on goods, taxes on income and profits have a relatively egalitarian character.
Corporate taxes have since 2006-07 emerged as the single largest source of taxation for the Central Government.

Despite all its claims of being at the service of the common man, Delhi police has earned the dubious distinction of facing the maximum number of bribery cases from amongst all the state departments. As many as 15 out of a total 34 bribe cases filed against various state departments in 2007 are against men in the khaki uniform. Also, 17 cops are facing charges under the Prevention of Corruption Act, according to the figures by Delhi Government Vigilance Department tabled in state assembly recently. After Delhi police comes Municipal Corporation and State Transport Authority which have got four and three cases against them respectively.

During 2007, two corruption cases each were registered against Finance department and New Delhi Municipal Corporation (NDMC) while one case each was registered against Delhi Jal Board, Education, Waqf Board, DTC and health department besides others. In all, 37 government employees including 17 from police followed by five from MCD have been booked under the Prevention of Corruption Act, the Vigilance figures tell.

Indicating a nexus between the officials and the private individuals, the department has also registered bribe cases against at least eight non-officials. Besides, the figures reveal that in 2007, chargesheet was filed in 15 cases against the same number of personnel. Also, files against six officials had been sent to their respective departments for appropriate departmental action. The trend hardly looked any better this year as in the last three months, the Vigilance has already registered a case against three municipal officials for allegedly misusing the power vested in them by official position.

The much-awaited night-landing facility at Visakhapatnam airport finally became operational on 30th March,2008. With the landing of a Spicejet Airlines flight from Hyderabad at 7.10 p.m., the facility became operational at the airport, in this coastal city of Andhra Pradesh. Till now, the flights were being operated only from 8 a.m. to 5 p.m. as the Indian Navy, which controls the airport, had not given night-landing permission to commercial flights. The move is expected to improve connectivity to the city, a fast-growing industrial centre and a major tourism hub.

The night-landing facility was scheduled to be launched in March last year but was postponed on several occasions as the navy was not ready. The navy, which has its Eastern Naval Command headquarters in the city, had to obtain clearance from the defence ministry for allowing commercial flights at nights. The Airports Authority of India (AAI) had last year built a new 10,000 feet runway and installed instrument landing system.

The Air Travellers’ Association of India (ATAI) organised a programme to mark the launching of night-landing facility. Union Minister of State for Mines T. Subbarami Reddy hoped that the new facility would spur faster development of the city. ATAI president Varda Reddy said with the facility becoming operational, more airline operators would flock to Visakhapatnam and more investment would flow into the city.

Despite the frequent flooding of the airport during rains and other problems in recent years, the airport witnessed impressive growth in passenger traffic. According to airport officials, the airport handled half a million passengers last year, registering a growth of 30 percent. The night-landing facility is expected to increase the number of passengers by another 200,000 per annum, as at least six airlines were ready to operate flights during night.

The defence ministry, the AAI and the state government last year took up the expansion of the airport at a cost of Rs.1.91 billion. With the expansion of the runway, the airport is equipped to handle wide-bodied aircraft like Boeing 767. The airport handles 11 flights daily, linking the city with Hyderabad, Kolkata, Chennai, Mumbai and Delhi.

The authorities hope that with the new facilities, airlines would come forward to operate international flights to Visakhapatnam. They believe that the airport had the potential to emerge as a gateway for Southeast Asian countries. The airlines, including Malaysian Airlines and Silk Air of Singapore which at present operate flights between Hyderabad and destinations in southeastern countries, may find Visakhapatnam more suitable.

Hints have emerged from China that it may be gearing for a project on the Brahmaputra that threatens drought in India’s Northeast, environment experts and Indian officials claim. Delhi, however, has decided to ignore the developments and instead volunteered to pay Beijing for help in avoiding floods in the region, government sources here said. China, despite official disclaimers, has long been suspected of planning to divert the waters of the Brahmaputra, which originates in southwest Tibet as the Yarlung Zangbo or Tsangpo —to its thirsty northwest. Experts have warned that such a project could trigger an ecological disaster in India’s Northeast and Bangladesh.

In recent weeks, a flood of technical articles has appeared in China backing the diversion plan, indicating Beijing is setting the stage for the project, Indian officials said. They said the Chinese government had also built an airstrip on the river’s banks close to a potential diversion point where a dam could come up. Himanshu Thakkar of South Asia Network on Dams, Rivers & People, an NGO, said the Chinese project could divert 200 billion cubic metres of water annually to the Yellow River, leaving Assam dry during the lean season.

However, the Union water resources ministry secretary, Umesh Narayan Panjiar, said: “There are no concrete developments. We are watching.” Other government sources said from all indications, Delhi had no plans to respond till detailed project reports came out in China. “Then it could be too late,” an official said. The Centre has not carried out any study on the possible magnitude of the impact of a Chinese diversion project, or worked out a contingency plan for Arunachal Pradesh and Assam, the states that would be hit the worst.

Delhi, however, is happy that Beijing has agreed to add two more monitoring stations to its array of three on the Tsangpo/Brahmaputra to forewarn against floods. India has decided to fund the maintenance of the two new stations. China shares weather forecast data from its three existing stations with India. Some like the Asom Gana Parishad MP from Assam’s Lakhimpur, Arun Sarma, feel that the government knows something about the Chinese plans but has been “covering it up”. He had asked water resources minister Saifuddin Soz for a clarification but the answer did not satisfy him as the Beijing had no plans to divert the Brahmaputra’s waters.