Reports have appeared in the media regarding a noting of the Private Secretary to the Prime Minister conveying the directions of the Prime Minister on a matter relating to the allocation of spectrum. The noting in question was recorded on 23 January, 2008 and stated that 'PM wants this informally shared with the Department (of Telecom). (He) does not want a formal communication and wants PMO to be at arms length.'

2. A number of unwarranted inferences have been drawn from this noting without considering the issue that was being examined and the context in which these directions were conveyed. In particular, an impression is sought to be created that the noting was in response to the Prime Minister being informed of steps being taken which he knew were inappropriate but he looked the other way.

3. The note of the Prime Minister's Office, on which the above noting was recorded, proposed consideration of an approach as follows:

a) Fix a 'threshold' level of spectrum that each operator must have in order to function with a minimum level of efficiency.

b) Existing operators holding spectrum above the threshold level may be allowed a certain amount of time to raise the subscriber levels to reach full utilization of spectrum, failing which the excess spectrum may be withdrawn.

c) New operators may be allotted spectrum only up to the threshold level on payment of the normal fees.

d) The balance spectrum may then be auctioned among all those who hold spectrum up to the threshold level.

4. It may be seen that the approach was intended to create a level playing field between existing operators and new entrants. It did not deal with either issues relating to manner of grant of licence or charges for spectrum up to the threshold level.

5. The proposal of the Prime Minister's Office was to forward these suggestions to the Department of Telecom for further consideration on the basis of individual consultations with the main players and TRAI.

6. It was well known at that time that there were conflicting interests between existing operators and new entrants. The Prime Minister felt that this matter required detailed examination and deliberation by the Department of Telecom in consultation with TRAI and others. He felt that, under the circumstances, it was not appropriate for the Prime Minister's Office to pronounce on the matter till the subject had been carefully considered by the administrative ministry in consultation with TRAI and other concerned departments. Therefore, it was sent as an informal suggestion to the Department of Telecom for consideration.

7. The above clearly brings out that the noting under question can in no way be construed to mean that the Prime Minister or his office looked the other way on matters relating to the grant of licence or spectrum charges etc. It related solely to the manner in which the approach summarized above should be conveyed to the Department of Telecom to be considered on merits without being viewed as a direction from the Prime Minister or his office.