Nandigrams acros India and the battle of the titans

Nandigrams across India:

Folks like almost all of India, I have been hearing some words time and again on TV since approx Jan this year but never paid any real attention to them. The words were Singur and Nadigram.

I heard the words but they were about a world away like ethic cleansing in Bosnia, something which was sort of insulated, cushioned away from me by sheer distance. Today for the first time I decided to learn some more about it and believe me I dug up a whole dirty stinking pile of dirt.

I got diverted from my studies on Nadigram to Special Economic Zones to the Land Acquisition Act.

It’s amazing, when you read the history of the land acquisition act you will see that, it was first started by the British in 1824. This was a very colonial law which allowed the British to acquire any property they required for roads, ports and other such "public" causes. This was then expanded to cover the railways which was a separate entity.

In 1870, there was a concept of 'solatium' (additional compensation over market value in view of the involuntary nature of parting with the land) introduced, and the right of appeal to civil court in case of dispute introduced. There were minor changes over a period of time and in 1894 it became the 'Land Acquisition Act 1894' which has remained almost unaltered to current date.


The next turning point came in 1962 when the Supreme Court passed a judgment which said "the Land Acquisition Act did not contemplate that the Government should be made a general agent for companies to acquire lands for them for their private profit". However as usual the government of that time overruled the excellent judgment and allowed land to be acquired for a company "which is engaged in or is taking steps for engaging in any industry or work for a public purpose".

At no point the terminology "public purpose" been locked down, in fact things have become murkier and murkier. We now see two very dangerous provisions in the THE LAND ACQUISITION ACT, 1894 ( click here for the full amended text)

The first of them is :

Clause 6: which says "Subject to the provision of Part VII of this Act, [appropriate Government] is satisfied, after considering the report, if any, made under section 5A, sub-section (2)], that any particular land is needed for a public purpose, or for a Company, a declaration shall be made to that effect under the signature of a Secretary to such Government or of some officer duly authorized to certify its orders [and different declarations may be made from time to time in respect of different parcels of any land covered by the same notification under section 4, sub-section (I) irrespective of whether one report or different reports has or have been made (wherever required) under section 5A, sub-section (2)]; "

OR IN SIMPLE ENGLISH --- The collector on the orders of the Government (read vested interests) the collector can declare any area as required for public purposes OR FOR A COMPANY.

The second of them is :

Clause 44A. Restriction on transfer, etc. - No Company for which any land is acquired under this Part shall be entitled to transfer the said land or any part thereof by sale, mortgage, gift, lease or otherwise except with the previous sanction of the appropriate Government.

OR IN SIMPLE ENGLISH- All it takes you to sell land you have received at a fraction of land value from the government is a simple order / sanction from the Government and we all know how much we can rust our Government to protect our interests don’t we.

I cant think of a better way to make a few hundred / thousand crores can you.

Let’s take the case of Mumai SEZ. The last unconfirmed reports I have heard are that the land is being picked up at Rs. 2 Lakhs an acre whereas land in even underdeveloped cities like Nasik is now running at Rs. 40 Lakhs an acre..........

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Battle of the Titans:

I have just seen both the Cellular Operators Association of India (COAI) and Anil Ambani cross swords on television. The issue being discussed is spectrum.

Let us understand what is spectrum. All cellular and other wireless operations need something called bandwidth to be able to transmit and receive signals. This is normally regulated by the Government to ensure that people don’t accidentally cut off airplane communication or defense communication with a good night call to their girlfriends.

Your local cordless is a good example, if you look at the boxes of one of the new cordless in the market you will see something saying Frequency 2.4 GHz. This is normally what is known as open frequency or unlicensed spectrum which can be used for everyday communication without special government permissions for each and every handset.

A bunch of frequencies bundled together is called spectrum. The bone of contention is that the new norms are now asking the COAI members to increase the current number of users they have to keep the spectrum they currently hold.

I am confused. A few months ago I saw a televised three way debate where representatives from the leading CDMA operator in a debate with the representative of the COAI defended their not giving up the excess spectrum they were holding which was given to them when they did a almost free handset scheme launch and showed an astronomical number of users which later dropped radically.

Their defense was they would soon need the spectrum again whereas the poor COAI rep who kept insisting that the spectrum in excess of current users should be yielded and then applied for again went the number of users went up.

I'm amazed at how many times we have been gang raped in the telecom scenario and are still able to smile and bear it.

First of all came the news that a company had given the relative of a telecom minister shares at Re.1/- per share whereas market price was much higher. Investigations were promised, nothing came of this.

Then came a second rape, a company went out and launched an amazing almost free offer. This allowed them to claim an amazing number of users which of course allowed them access to spectrum which was scarce. They also did this on CDMA which was a technology used by mainly America at that time. The rest of the world was using GSM as the dominant technology.


The company at that time declared that they were using the latest generation of CDMA which was far superior to any GSM technology, in fact their managing director even talked about CDMA making watching streaming movies on the handsets a reality in comparison to current technologies.


The realisation that all as not kosher started when it was found out that the negligible amount for handset scheme was a fiasco with the insurance company which had underwritten the handset bearing a large amount of the loss, and the number of users dropped radically. Losses to insurance companies translates to larger premiums to all of us for the other products the companies sell.

However according to me it achieved what it was supposed to do:

1) It built an amazing amount of investor confidence in the company.

2) It allowed the company to gain and hold onto spectrum which it would never have received had it done a traditional launch.

3) Had they lauched a GSM service, they would have been a me too product but as a CDMA player they had almost a full market to themselves.

Now the same company which praised CDMA to the skies is talking about starting a new service in GSM base. What was it about GSM not being a patch on CDMA but then I always say the Indian public has short memories they will swallow anything and 6 months later you can offer them something 180 opposite and they will still lick it up.

This now means all those consumers who spent money on handsets etc for CDMA based sevice will now have to reinvest in a GSM set. Secondly all that much hyped CDMA equipment purchased like transmission cell equipment etc will all go to waste meaning losses passed onto the small investor. In any other country , the CEO would be lynched for this kind of flip flopping. The market regulators would have come down like a ton of bricks , but mera bhaarat mahaan.

Guess what there’s one more rape in the offing.

Just when the GSM licence is coming in for this new provider, there is a major move to push number portability. This means that a customer can switch his phone provider but his number will remain the same. In simpler terms for the operator at the end of it all , though he will technically have both a GSM and a CDMA network perhaps under a different umbrella company, the CDMA guys can just jump over to the GSM offering without losing the current number.

This is pure Check mate for the other GSM cellular operators. They may gain and lose some customers but the losses / wins will even out. The one who will 100% will be the CDMA operator who will now gain customers from all other GSM operators now that they too are able to offer GSM services.

In fact the number portability is being pushed through in such a hurry that there is clause being inserted that number portability will be for metros first and rest of the country later. Sunil Mittal of Airtel is screaming himself hoarse asking why this hurry and why cant we wait till number portability can be done evenly but we all know which way the mandarins will vote.

Sirs I salute you!!!!! I think you have truly justified calling India the land of Chanakya.