Need to restore investor confidence in telecom sector: Ravishankar Prasad
Ensuring customer satisfaction and restoring the declining investor sentiment will be the key areas that would keep the new Telecom Minister, Ravishankar Prasad tied up at least for the next couple of years. Prasad took charge of the Ministry of Communications and IT apart from Ministry of Law and Justice on Tuesday, much like his predecessor Kapil Sibal who held the two key portfolios before. According to political experts, the move two hold two portfolios could be to check out and follow the UPA's model of functioning. However on being asked if he had asked for these ministries, Prasad denied saying, "we are not in the habit of asking for any ministry." While Prasad resisted criticising the UPA government on his first day, he talked about the bad shape of the sector. "I am aware of the problems of the telecom department ... it has been in the news for many of the wrong reasons and one of my first priority would be to set things right.My focus would be to ensure the quality of service for the consumer interest and to restore the investor confidence," Prasad told reporters. "The way things have happened in the past, have dented the investor confidence and you need to restore that. This will be my first step because in telecom industry 100% FDI is permitted therefore the 100% FDI must be quickened, must be helped to come in India under transparent regime," he added. Talking about the retrospective tax amendment brought into place by the UPA government, the minister said, "Our manifesto is very clear. Fiscal policy issues must be stable which can generate investor confidence therefore I cannot say, in certain, very specific situation there can be a need for retrospective intervention. This I am telling also as a law minister of India but in general terms the rule of the game must be stable, transparent, to be implemented in proper and objective manner." There are over half a dozen firms across the country which are caught up in multi-billion dollar tax issues with the Indian government. This includes Vodafone group's Indian telecom firm which faces a Rs 20,000 crore tax demand including interest and penalties related to its $11 billion transaction by acquiring a controlling stake in the then Hutchison Essar, now known as Vodafone India. Another firm, the Indian unit of Europe's largest oil producer Royal Dutch Shell Plc, Shell India Markets has also been caught under similar tax issues. The company has been issued a transfer pricing adjustment of $3 billion and a tax demand of $1 billion by the Income Tax department. Other companies involved in different tax disputes with the Indian government are Finnish handset manufacturer Nokia, IT firm IBM and multi-national corporation WNS holding. He said that litigations are one of the key issues he will take into account to improve the sector's health. "I have told my officials to give me a very elaborate presentation on what are the issues under litigation, let me understand it. Dialogues will be on the board, let me first understand the issue. He also emphasised on the need of a softer regulatory mechanism which brought more stability to the sector. "Of late we have seen that the Telecom Regulatory Authority of India (TRAI) and the Department of Telecom (DoT) have been at logger heads with regards to various policy issues." "If the regulations are softer, they will generate confidence and as a minister, I shall ensure whatever the regulations are there, they must be strictly followed. Let me try to remove bottlenecks," he said. The minister also said that establishing a broadband highway shall be a big area of the ministry's focus. "If Mr. Atal Bihari was known for national highway, Shri Narendra Modi government will be known for the broadband highway," he said.