Reasons: Why 3G Auction Was Failed Thrice in Pakistan

For nearly ten years now, as an academic and through my UK-based company, PolicyTracker, I have enjoyed writing, teaching and doing consultancy work on spectrum policy. I have become pretty familiar with the issues this raises, but I am now in new territory: I feel compelled to comment on an issue in which I have a large personal involvement.

I was briefly employed by the Pakistan Telecommunications Authority (PTA) to advise and provide auction software for the 3G licencing deal. My contract was cancelled halfway through and my wage cheque withheld. The PTA is now refusing to pay me a single penny. The same applies to the other people I was working with, independent consultants Dennis Ward and Rob Nicholls of Webb Henderson.

Having travelled to Pakistan and commissioned software development work at my own expense, I am less than delighted with the outcome. (That is English understatement by the way!)  However, I do not want to use this article to berate the PTA, tempting though it is. The circumstances which led to our appointment – and dismissal – point to a much wider and more important issue which needs public debate.

 A lack of confidence

The deeper issue, I feel, is the PTA’s lack of independence and lack of confidence. By law, it is an independent regulator, yet politicians do not accept this in practice and the PTA does not vigorously pursue its mandate.

As the PTA has failed before, politicians lack confidence in its abilities. Last year, the government parachuted in a new chairman, Farooq Ahmed Awan, who had a reputation for “getting things done”. The prime minister thereafter set up an auction supervisory committee to drive things forward.

This ruffled feathers at the PTA, notably those of the two other members of the PTA executive body: the Member Finance and the Member Technical. They claimed to be unfairly sidelined; eventually, the courts agreed, ruling that the chairman was unlawfully appointed.

This is a cyclical thing: the PTA underperforms, the government intervenes, and the intervention fails because of a legal challenge or internal PTA opposition. There is a strong circle of distrust, and until it is broken, Pakistan’s telecom sector will continue to suffer.

The politics

There is a further dynamic. 3G itself is heavily politicised. Opposition parties do not want the PPP to go into the forthcoming election as the party that gave the country mobile internet. The opposition parties believe that stopping the 3G process will help their election campaign. And, for anyone within the PTA with anti-government views, that leaves plenty of scope for mischief.

However, there is no political bounty in 3G, and that is the tragedy. The ruling PPP might have won some political advantage from conducting the auction, but gained little benefit if it lost the election and had to hand around $1 billion in proceeds to one of the opposition parties.

The ordinary citizens of Pakistan would be the only real winners from an early auction, both in terms of auction proceeds and the economic boost which 3G would bring. If an independent and confident PTA had pursued its mandate to make the best use of the radio spectrum and to modernise telecoms services, it would have safeguarded public interest by rising above political pressures.

One can understand the government’s desire to interfere: no country can waste opportunities worth as much as $1 billion. But Pakistan is a relatively young democracy, hoping this May to make its first direct transition from one civilian government to another. Let’s hope that whoever wins power will take a mature view of the benefits of independent regulation. Let’s also hope that the PTA acts decisively to exercise its mandate – otherwise this circle of distrust will never be broken.

The impartial, unpoliticised exercise of agreed policy is the only way to eliminate the uncertainty which holds back the development of the national telecom sector, and in ensuring the Pakistani people can enjoy the benefits of 3G before everyone else has moved on to 4G and beyond.

The writer is a UK-based consultant on telecom-related policy