Date:26/12/2004 URL: http://www.thehindubusinessline.com/2004/12/26/stories/2004122601030500.htm

Back US telecom body charges VSNL with flouting WTO norms

Thomas K. Thomas

New Delhi , Dec. 25

THE Telecommunications Industry Association (TIA), a trade association representing 700 American IT and communication companies, has charged VSNL with undertaking anti-competitive practices and has urged the US Government to monitor the situation in the light of the WTO agreement.

The association has said VSNL was using its control over the landing stations in India to delay and limit the availability of undersea cable facility to and from India.

In a letter written to the US Trade Representative on December 17, TIA said VSNL was also keeping the bandwidth price artificially high and was preventing upgradation to undersea cables landing in India.

"It is our understanding the VSNL has not complied with its earlier commitment to provide additional capacity and the company continues to charge exorbitant prices to the detriment of US customers and US companies in India that need capacity."

TIA has also commented on the telecom sector in China and South Korea in its letter.

Responding to the TIA letter, sources in VSNL said, "The Government of India is in full compliance with its telecommunications obligations under the WTO Agreement regarding access to cable landing station facilities. The specific WTO provision does not even apply to India.

The letter released by TIA merely reiterates the baseless claims of another trade association called CompTel/Alliance lodged unsuccessfully with the US Government last year, and these claims are equally devoid of merit today."

TIA, on the other hand, has said that VSNL's conduct had serious adverse effects for US telecom and IT companies that desire access to the Indian market, which also results in increased charges for calls to and from India.

"We urge the US Government to closely monitor this situation and urge that VSNL stop inhibiting access points to India."

Apart from VSNL, Network i2i (the Bharti-Singtel joint venture) is the only other company with a landing station for undersea cables in India.

Reliance Infocomm has proposed to set up a cable network system called Falcon with a landing station in Mumbai.

However, the Reliance project hit a bump after VSNL and other minority stakeholders objected to the integration of Falcon with another Reliance-owned cable network, Flag, which in turn has a tie-up with VSNL for using its landing station.

Flag has been looking to get an entry point into the country on its own and break away from the arrangement with VSNL.