The Union Budget of 1997 — known for some bold initiatives — was still a week away when a landmark step was taken for the rapidly evolving telecom sector. The Telecom Regulatory Authority of India (Trai) was set up on February 20 that year with the objective of creating an independent body to regulate the sector, rather than leaving the government to carry on with the job.
The backdrop was important. Mobile telephony had taken off in 1995, and private players were ready to give competition to government-owned phone service providers, which had landline monopolies for years. The idea was to divide the tasks between the Department of Telecommunications (DoT) and Trai — DoT was to be the overarching policymaker and Trai the principal regulator for the telecom industry.Through the course of the journey, however, the objective with which Trai was constituted appears to have been only partially addressed. To an industry observer, Trai may be a regulator on paper, but it is a recommender for all practical purposes. The DoT is the licensor, the spectrum management authority, the main penalty decision-maker for operators. In other words, a regulator in the real sense. It also oversees a host of consumer-related issues, including compliance with quality of service norms, and setting rules for recruitment at Trai.
