The Indian Techonomist

Sample issue, July 1995 - (C) Copyright 1995 Deus X Machina, All rights reserved
Media policy

Regulating the regulators

India's planned regulatory authorities for telecom and broadcasting could really be independent

The Indian government has never had much difficulty accepting the freedom of the press. The electronic media make it nervous, though, and both broadcasting and communications have been government monopolies ever since the British wrote the Indian Telegraph Act - the keystone of the country's communications law - 110 years ago. Finally forced to open both areas to the private sector, it has been widely assumed that the government would retain indirect control through supposedly autonomous regulatory authorities to be created later this year. This will probably not be the case.

Reforming telecom...

When the Department of Telecommunications (DoT) expressed its intention, two years ago, to allow private corporations to offer telephony services, it took a bold if inevitable step. The DoT was (and still is, for the moment) a sprawling organisation that not only ran the country's entire telephone system but also, through a tangle of ex-officio positions for its Secretary particularly as Chairman of the powerful Telecom Commission, controlled all policy. In welcoming the private and foreign investment necessary to improve India's dismal telephone coverage and address a huge unsatisfied demand, the DoT risked considerable erosion of its power. Although some of the more radical suggestions of the series of committees appointed to plan the liberalisation process - such as the privatisation of the DoT (which has some half a million employees) - were squashed by the politically sensitive Minister for Communications, there was no escaping a telecom regulator. And if the government insisted on being one of the competitors, it could hardly play policeman too.

It was initially expected that the DoT would design an apparently autonomous authority with compliance to the government built in, possibly camouflaged with a few more ex-officio positions here and there. Earlier this year, though, the government clarified that, first, the three-member Telecom Regulatory Authority of India (TRAI) would not only referee fights between service providers, but would also set guidelines on tariffs and evaluate the technical aspects of bids for basic and cellular services (announced on June 7th). Second, it would consist of, in effect, a retired judge, a professor and an accountant. Whether the DoT (or anybody) would have to listen to this body, and how vulnerable it would be to government control, remained unclear.

A "fearless umpire?"

In an exclusive interview with the Indian Techonomist at the end of May, R K Takkar, Secretary, DoT and Chairman, Telecom Commission said that the government was "committed to treating [the TRAI] as independent and autonomous," and proceeded to detail exactly how.

First, it plans a one-line amendment (which was not passed by Parliament during last month's session only due to insufficient time) to the Indian Telegraph Act of 1885, to shift the powers of the government (in the form of the Director General of Telecommunications, one of the Secretary's ex-officio avatars) to the TRAI for most purposes: determining tariff; monitoring excess charges and revenue sharing between operators (including the DoT); settling disputes between operators; and protecting consumer rights. However, the TRAI will not grant licences to operate, as the government retains this right. Nor will the TRAI interfere with the government's powers to wiretap under special circumstances. This and other "national security" issues are detailed in the tender documents issued by the DoT for bids on basic services, and allowing the government the "ultimate remedy" of taking over network operations in the event of "internal disturbances and sabotage" is part of the licencing terms (see news bulletin on telecom and security).

The one-line amendment would still make the TRAI draw its authority from a notification issued by the government, on the basis of the amendment. Ultimately the TRAI will have statutory powers. The government is working on separate legislation to formalize the TRAI as an autonomous regulator similar to the SEBI, which monitors India's stock exchanges and is not accused of being compliant to the government. "The law will be self contained," says Mr Takkar, and will detail the body's functions, responsibilities, members' qualifications, tenure and powers. Most importantly for its role as an unbiased regulator, "it will draw its authority to act not from the executive wing of the government" but "direct from Parliament."

But this legislation is on the horizon - it will be prepared after a year or two, with the benefit of experience of the TRAI's actual performance; till then the body is the government's creation. Although he admits that the lack of statutory powers will be a "handicap in theory," Mr Takkar wants the TRAI to function as a "de facto statutory authority." With that aim, the government will appoint the TRAI members on secure tenure for five years, so that, like Supreme Court judges, they do not risk being removed by an inimical government. Nor do they risk being suddenly disempowered, for as Mr Takkar says, "terms and conditions cannot be changed adversely during their appointment."

Mr Takkar emphatically reiterates that even during this interim period, the TRAI is not the DoT. It is "outside the government, at arm's length." and will, he insists, "act fearlessly and independently and be a good, fair and just umpire."

... And freeing the airwaves

While telecom liberalisation is born of financial need, in broadcasting the government has no such compunction. It does not see in broadcasting the same socially laudable goals of building communications infrastructure. After the so-called "invasion from the skies" of satellite TV targeted at Indians but broadcast (sometimes by Indians themselves) from abroad, the revamped state TV monopoly Doordarshan is only multiplying its advertising revenues. Luckily for those who would like greater diversity and find the present situation, where foreigners can reach Indian audiences while Indians (apart from the government) cannot, this state monopoly was overturned by a Supreme Court judgement in February (see Monopolies and free speech). The government had to take action. Strangely enough, instead of running for cover beneath legal loopholes and red tape, it is planning some very progressive legislation later this year, to create an independent regulatory authority for a broadcasting world with private competition.

A draft of the legislation, which will probably be called the Indian Broadcasting Act, was prepared in May and is being reviewed by the Law Ministry. If passed by Parliament in its next session in August, the Act would set up by the end of 1995 a fairly powerful Indian Broadcasting Authority, separate from the government, to licence and regulate broadcasters. Although the Act cannot be disclosed to the public before it is made available to Parliament, in an exclusive interview with the Indian Techonomist, Bhaskar Ghose, Secretary for Information and Broadcasting, agreed to discuss the broad outlines of this possibly revolutionary legislation.

Until now, the basic law in broadcasting has been a few paragraphs in the wholly inadequate Indian Telegraph Act (ITA), practically unchanged since 1885. The ITA states, simply enough, that the airwaves are the property of the Union (Federal) government, to do with as it likes - though the Supreme Court thinks otherwise. Guidelines for content and freedom of expression as it applies to electronic media are contained in the Cinematograph Act, this not quite 50 years old. The Indian Broadcasting Act is supposed to put together these various bits of law and define the roles of both the government as well as the new Broadcasting Authority, which will derive its powers from an Act of Parliament rather than whims of government - a privileged status that the Telecom Regulatory Authority of India will take a couple of years to reach.

The powers of the Indian Broadcasting Authority (IBA) will be "mainly for software," says Mr Ghose, involving broadcast content rather than technical matters (which will be handled mainly by the Telecom Regulatory Authority of India, TRAI - see Convergence, Indian style). It will set guidelines for advertising and programming that implement the requirements of the Cinematograph Act. It will probably have support staff so that it can act on complaints from members of the public in a manner similar to the US Federal Communications Commission, investigating infractions of its guidelines and possibly terminating violators' licences. Despite the compliance of the Supreme Court on this point, the IBA will not insist on previewing programmes before broadcast. This practice of "pre-censorship" has been adopted by Doordarshan for the privately produced programming it uses, but "it would be far too much," says Mr Ghose, for the IBA to do.

The IBA, unlike the TRAI, will also grant licences to prospective broadcasters, though exactly how is unclear at this stage. The government "may not take" the route of franchising, says Mr Ghose, as creating regional oligopolies, while perhaps acceptable in basic telephony services, would go against the spirit of the Supreme Court judgement, which emphasised diversity among broadcasters. More likely is the issuing of non-exclusive licences. Still, the IBA would have to follow the "overall guidelines" of the government in issuing them. These are not final yet, but are almost certain to allow non-profit organisations, individuals, and Indian-registered companies to start cable-TV networks, as well as satellite or terrestrial TV and radio channels. Also permitted to broadcast will be private telephone service providers, of which foreigners are already allowed to own 49%. (Incidentally foreign investment is not allowed in the Indian press thanks to opposition from two large and monopolistic media empires, the arguments in favour from smaller publishers notwithstanding.)

According to Mr Ghose, the IBA will have "no contact with the government." Although its membership has not been decided yet, the government has "envisaged a body [with] maybe half-a-dozen members," from legal and technical backgrounds, along with some "eminent people" - artists, writers, respected public personalities. Like the TRAI it will probably be headed by a retired Supreme Court judge. Like the TRAI, it will not include anyone from the industry, though retired broadcasters are not taboo. "We have to have at least one person with a [technical] knowledge of broadcasting," says Mr Ghose. This will serve for the IBA the purpose of the TRAI's "technocrat" member, of not being absolutely dependent on various technical advisors or reports the government may flood it with. As almost anyone with broadcast experience in India has worked at some point of time with either Doordarshan or the state-owned All India Radio, could this be a back-door entry for government interference? Not likely - after all, most people leave the state monopoly to join private content producers, and rarely have government interests in mind; their involvement in the old-boy network may in fact benefit the IBA. In any case, as Mr Ghose puts it, "there really isn't any [private broadcasting] industry worth the name, because it's just started," so the government has little choice.

So, given that the Broadcasting Act has a successful time in Parliament in August - there's no reason for it not to, as the Opposition is always hurt by government-controlled TV - and it takes only a couple of weeks for the IBA to be set up, as Mr Ghose suggests, can we expect a private satellite or terrestrial TV channel broadcast from within India next January? Says Mr Ghose, "Perhaps."


(C) Copyright 1995 Deus X Machina, Rishab Aiyer Ghosh. ALL RIGHTS RESERVED.

This article may be redistributed in electronic form only, provided that the article and this notice remain intact. This article may not under any circumstances be redistributed or resold in any non-electronic form, or for compensation of any kind, without prior written permission from Rishab Aiyer Ghosh (

This article is from the Indian Techonomist (, the newsletter on India's information industry. Annual subscription (monthly print edition plus e-mail bulletins) is for US$ 595 or equivalent. For information, contact Rishab Ghosh by e-mail at, call +91 11 2454717 or post to A4/204 Ekta Apts, 9 I.P. Extn, New Delhi 110092, INDIA.

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