Report

More documents

Recommendations

Info

170 QUANTIFICATION OF BENEFITS FROM ECONOMIC COOPERATION IN SOUTH ASIA For cellular mobile it committed to four suppliers in addition to the government owned operator. The commitment also included the possibility of review of regulatory principles in the future. International Long Distance, however, remained a government monopoly and no bypass of the network facilities owned by the government has been permitted. Bangladesh also submitted an MFN exemption list to permit the government or the government-run operator to apply differential measures, such as accounting rates, in bilateral agreements with other operators or countries. Bangladesh has not submitted an offer to the WTO or at least it is not available in the public domain. The fact that the applicable regime is not bound for Bangladesh, (and for that matter for all SAFTA countries) cannot be for reasons to protect the incumbent supplier and gradually introduce it to competition. 8 The reality on the ground is that competition already exists, and while the commitment does not permit bypass of government owned operator facilities, the applicable regime in Bangladesh is vastly different. An interconnection regime is in place and private long distance operators can carry traffic both within and outside the country. The reason must be therefore be found elsewhere. Binding the applicable regime under GATS rules out the possibility or at least makes it difficult to backtrack on liberalisation. However, entry restrictions in telecom are becoming increasingly difficult to justify given technological progress and the acknowledged benefits of competition. Therefore, the option value of ‘backtracking’ is also unlikely to provide the answer. The only real possibility is that Bangladesh like other SAFTA countries will look to trade off increased market access in telecom under GATS to secure benefits in sectors of their comparative advantage, such as Mode 4. India Prior to the liberalisation of the 1990s, the telecommunication sector in India was under a public monopoly, which was then considered essential due to the public good nature of the services. In the 1990s, Indian government gave up its monopoly and gradually introduced competition to enhance investment, improve productivity and the growth rate. The entry of private and foreign players led to significant expansion in telecommunication network, introduction of new technologies and striking improvement in productivity. As a consequence, India, today, has one of the largest telecommunication networks in the world. Given the rapid growth of the sector and huge investment potential, the country is an attractive destination for foreign direct investment. On its part, India needs to enhance the growth of telecommunication sector to sustain its global competitiveness in knowledge-based services. Before the mid-1990s, government was the sole provider of telecommunication services in India and all telecommunication services were provided by the incumbent monopoly – department of telecommunication (DoT). The first step towards deregulation was the announcement of the national telecommunication policy (NTP 1994). Although NTP 94 was a major step towards liberalisation, there were some problems in its implementation, among them being the non existence of an independent regulator (Kathuria 2007). The inadequacies of NTP 94 led to the formulation of a new, more elaborate policy – NTP 99, which tried to infuse more competition in the sector and also recognised the role of investment in the economy and convergence of IT, media, telecommunication and consumer electronics. It envisaged provision of telecom services to all Indian villages at affordable prices and the provision of high-level services. It led to a shift to a system of one-time entry fee combined with revenue sharing payments from the license fee bid system, while duopoly rights were discontinued in order to allow for unlimited competition. The private sector was allowed to provide domestic long-distance services and, from April 2002, international long distance voice services, with no restriction on the number of participants. In the past 15 years, telecommunication sector of India witness major changes due to liberalisation and technological changes. Today, there are no restrictions on the entry of new players in basic, national long distance (NLD), international long distance (ILD), internet service provider (ISP) and infrastructure businesses. Four operators are allowed in cellular mobile in each service area. This has led to intense competition and a downward trend in tariffs. Some of the strategies being employed by service providers to compete in the market are bundling, segmentation across subscriber types, customisation, etc. Due to intense competition, many private players found it difficult to remain financially viable. This led to mergers and acquisitions and emergence of few big players. India, now, has one of the largest telecommunication networks in the world and its regulatory regime is at par with international developments. 8 The classic infant industry type of protection.
P ROSPECTS FOR THE TELECOMMUNICATION SECTOR UNDER SAFTA 171 India’s telecom renaissance has been remarkable. After 44 years of government monopoly, market liberalisation introduced in 1991 has led to a 10-fold increase in the number of phones in just 15 years. India’s network is one of the largest in the world and, after the People’s Republic of China, second largest among emerging economies. Given the persistent low telephone penetration rate compared to industrialised countries, but high levels of overall economic growth, the telecom sector offers vast potential. The mobile market recently topped 200 mn customers. It is therefore not surprising that India is one of the fastest growing telecom markets with an average annual growth of about 22% for basic telephony and over 100% for cellular and Internet services. Recognising that the telecom sector is one of the prime-movers of economy, the Government’s regulatory and policy initiatives have been directed toward establishing a world-class telecommunications infrastructure. Capital requirements are considerable. India requires investments of at least $69 bn by 2010. India’s telecommunications sector is now among the most deregulated in the world and presents potentially lucrative opportunities for service providers and equipment vendors alike. Companies that have successfully seized the opportunity are Agilent, AT&T Cisco, HP, Hughes Network Systems, Lucent Technologies, MCI Motorola, Qualcomm, Sprint and Tekelec. Table 15.4 Key Telecom Indicators for India Population * 1110 Fixed lines * 51 Fixed teledensity 5% Mobile phones * 220 Mobile density 20% * million Source: www.trai.gov.in Comparison of the applicable regime described above and the commitments made by India (1997) reflect the limited nature of the commitments made by India (See Appendix Table 15.4). India undertook the following commitments in 1997: • For voice telephony – there will be of one operator other than DOT/ MTNL in each service area for a period of 10 years after which the position will be reviewed – The private operator should be a company registered in India in which total foreign equity must not exceed 25% – The service operator will be permitted to provide long distance service within the licensed service area only – Resale of voice telephony will not be permitted, but licensees can grant franchises for providing public call offices service – In the case of foreign investors having prior collaboration in that specific service sector in India, FIPB approval would be required. • For circuit-switched data transmission services • For facsimile services • For private leased circuit services – The private operator should be a company registered in India in which total foreign equity must not exceed 25% – The service operator will be permitted to provide long distance service within the licensed service area only – In the case of foreign investors having prior collaboration in that specific service sector in India, FIPB approval would be required. • For cellular mobile telephony – There will be two cellular operators in each service area, including one public sector operator – The private operator should be a company registered in India in which total foreign equity must not exceed 25% – The service operator will be permitted to provide long distance service within the licensed service area only. • Has MFN exemptions with regard to accounting rates. • Additional commitments taken are as follows: Commitment to a revised text (i.e. revised by India for its purpose) of the reference paper for regulatory framework. This revised text either deletes some provisions from the reference paper or alters it to clarify India’s commitment. Appendix Table 15.4 compares the relevant text of the reference paper and the commitment made with respect to those provisions by India. Compared to the commitments made by India in the last round, the current offer (2005) covers new areas. The restriction that only licensed voice telephony service providers can provide data, facsimile and private leased circuits has been dropped from India’s list of offer, as has been the constraint to deploy only GSM technology for cellular mobile service provision. India has thus offered to maintain technology neutrality in
Page 3 and 4:
QUANTIFICATION OF BENEFITS FROM ECO
Page 5 and 6:
QUANTIFICATION OF BENEFITS FROM ECO
Page 7:
Preface Our consultations with seni
Page 10 and 11:
viii CONTENTS 7. Revenue and Welfar
Page 13 and 14:
Executive Summary OBJECTIVE This st
Page 15 and 16:
EXECUTIVE SUMMARY xiii Table 1 EAMA
Page 17 and 18:
EXECUTIVE SUMMARY xv India A full S
Page 19 and 20:
EXECUTIVE SUMMARY xvii indicates th
Page 21 and 22:
EXECUTIVE SUMMARY xix ments on basi
Page 23:
Part I BENEFITS FROM TRADE, INVESTM
Page 26 and 27:
4 QUANTIFICATION OF BENEFITS FROM E
Page 28 and 29:
Page 30 and 31:
Page 32 and 33:
10 QUANTIFICATION OF BENEFITS FROM
Page 34 and 35:
Page 36 and 37:
Page 38 and 39:
Page 40 and 41:
Page 42 and 43:
Page 44 and 45:
Page 46 and 47:
2 Literature Review and Rationale f
Page 48 and 49:
Page 50 and 51:
Page 52 and 53:
Page 54 and 55:
Page 56 and 57:
Page 58 and 59:
Page 60 and 61:
4 Effective Additional Market Acces
Page 62 and 63:
Page 64 and 65:
Page 66 and 67:
Page 68 and 69:
Page 70 and 71:
6 Impact of SAFTA on Member Countri
Page 72 and 73:
Page 74 and 75:
Page 76 and 77:
7 Revenue and Welfare Implications
Page 78 and 79:
Page 80 and 81:
Page 82 and 83:
8 Impact of SAFTA on Inward and Out
Page 84 and 85:
Page 86 and 87:
Page 88 and 89:
Page 90 and 91:
Page 92 and 93:
9 Quantification of Benefits from T
Page 94 and 95:
Page 96 and 97:
Page 98 and 99:
Page 100 and 101:
Page 102 and 103:
Page 104 and 105:
Page 106 and 107:
Page 108 and 109:
Page 110 and 111:
Page 112 and 113:
Page 115:
Part II BENEFITS FROM DEEPENING INT
Page 118 and 119:
Page 120 and 121:
Page 122 and 123:
Page 124 and 125:
Page 126 and 127:
11 Construction and Related Enginee
Page 128 and 129:
Page 130 and 131:
Page 132 and 133:
Page 134 and 135:
Page 136 and 137:
Page 138 and 139:
Page 140 and 141:
12 Tourism and Travel Related Servi
Page 142 and 143: 120 QUANTIFICATION OF BENEFITS FROM
Page 172 and 173: 14 Health and Related Services 1 IN
Page 186 and 187: 15 Prospects for the Telecommunicat
Page 223: APPENDICES
Page 236 and 237: Appendix 8 Intra SAARC FDI Collabor
Page 238 and 239: Appendix 11 Table A11.1 On an Emplo
Page 240 and 241: Appendix 12 Original Commitments/In
Page 242 and 243:
Page 244 and 245:
Page 246 and 247:
Page 248 and 249:
Page 250 and 251:
Page 252 and 253:
Appendix 14 Table A14.1 Telecommuni
Page 254 and 255:
Page 256 and 257:
Page 258 and 259:
Appendix 15 REFERENCE PAPER Scope T
Page 261 and 262:
Bibliography Abelson, P. (1996),
Page 263 and 264:
BIBLIOGRAPHY 241 Cuba (2002), Negot
Page 265 and 266:
BIBLIOGRAPHY 243 (2004), Impacts of
Page 267 and 268:
BIBLIOGRAPHY 245 Silva, Patricia an
Page 269 and 270:
BIBLIOGRAPHY 247 (1998), Tourism Se
show all

Report

Create successful ePaper yourself

Delete template?

Save as template?