Telecom policy rejected: Financing, licencing targets not visible: ECC

The Economic Co-ordination Committee (ECC) of the Cabinet has reportedly rejected Telecommunication Policy 2015 on the plea that targets and goals regarding financing and licencing were not visible in the draft of the policy. Official documents reveal that the ECC was informed at a recent meeting that the telecom sector of Pakistan was deregulated in 2003, through the introduction of Deregulation Policy (2003), whereby the licensing regime for fixed telecommunication was established and market was opened for private sector to deploy network facilities and services.
Subsequently, in 2004, Mobile Cellular Policy was issued under which the first auction for cellular services was conducted and two new Cellular Mobile Operators began their operations in Pakistan. The Broadband Policy was also introduced by Ministry of IT in 2004 with the aim of broadband proliferation in the country. These policies were subject to review after five years of issuance, which could not be done during the term of the previous government. However, the Ministry of IT has been issuing policy directives under Section 8 of Pakistan Telecommunication (Re-organisation) Act, 1996 (Amended 2006) in order to cater for the emerging needs of the sector, which were either not addressed in the above mentioned policies or were required due to technological innovations/developments.
The present government initiated the process of review and integration of policies in June 2013. In this regard, Ministry of IT engaged renowned international consultant firm, M/s Intercai Mondiale for the project in February 2014 with financial assistance from the World Bank. The ECC of the Cabinet was updated on the process of consultation with stakeholders adopted by the MoIT for formulating the Draft Telecom Policy-2015 having the following salient features: (i) introduction of competition rules for promulgation of competition framework to maintain competitive and open telecommunications market, identification of significant market players and introduction of product markets for wholesale and retail services etc.; (ii) spectrum management which includes spectrum strategy, spectrum trading, spectrum re-farming, spectrum assignment, etc.; (iii) provision of general authorisation for Over The Top (OTT) services; (iv) satellite telecommunications with transition from open skies policy to a balanced approach; (v) communication security for sensitizing the requirement of securing telecom networks; and (vi) convergence, a phenomena of delivering of diverse services, belonging to the domains of telecoms, media and data services, over a single digital platform needs regulatory treatment in coming years.
Finance Minister, Senator Ishaq Dar who is also Chairman ECC observed that the policy [section 5.13.3] did not clearly reflect the structure and layout of tax rationalisation framework. He emphasised that the policy should be reflective of commitments rather than proposals. He further observed that classifying the telecommunication sector as an industry would not be appropriate and advised that both fiscal and constitutional aspects of the policy are important which should be addressed appropriately.
Chairman ECC also pointed out that the creation of a parallel competition framework, as envisaged in Section 5.1.17 of the draft policy would not be a best practice as the Competition Commission of Pakistan (CCP), being a statutory body, had already been established and mandated to perform such functions. The Secretary, MoIT explained that Section 5.1.17 was inserted in the policy in view of the legal obligations contained in the Pakistan Telecommunication (Re-organisation Act 1996) amended (2006). Secretary, Finance Division Dr Waqar Masood observed that targets and goals regarding financing and licencing were not visible in the proposed policy, nor was the distinction between IT and Telecom appropriate, and that it should be one ICT Policy. He said that Finance Division would provide some suggestions regarding Section 3, 5.1, 5.9, and 8.7.1 of the draft policy in this regard.
After detailed discussions, the ECC directed Secretary, MoIT and Special Assistant to Prime Minister on Law to review the draft policy keeping in view suggestions for improvements made during the meeting and the fiscal and legal aspects, within two weeks.