On the eve of the group of ministers' meeting on Thursday, the telecommunications sector was back to what it did best: making huge claims and counter-claims on government largesse.

While the basic service operators said the cellular firms had no case for further compensation because they had been provided Rs 89,072 crore (Rs 890.72 billion) of concessions by the government, the cellular operators pegged the concessions given to the basic service providers at Rs 106,350 crore (Rs 1,063.5 billion).

The Telecom Regulatory Authority of India has opposed any compensation to cellular operators and HDFC Chairman Deepak Parekh has suggested reduction of revenue share to compensate them. Finance Minister Jaswant Singh has hinted at a financial restructuring package to bail out the industry.

Hectic lobbying went on throughout the day as senior telecom executives met members of the group of ministers, which will discuss the issue of compensation to cellular operators tomorrow. For instance, Bharti group Chairman Sunil Mittal had a long meeting with Singh, who is the chairman of the ministerial group.

The basic service operators claimed that the cellular operators had been given numerous benefits to create a level playing field, including a graded reduction in licence fee from 17 per cent to 12 per cent, 10 per cent and 8 per cent, depending on the circle.

Trai also allowed them to retain 5 per cent of their long-distance revenue and brought wireless charges at par with those of basic firms. The benefits under these two heads were Rs 4,500 crore (Rs 45 billion) and Rs 750 crore (Rs 7.5 billion), respectively.

Migration from a fixed licence fee to revenue share (Rs 60,000 crore), increase in the licence fee payment period from 10 years to 20 years (Rs 15,000 crore), extension of the licence period from 10 years to 20 years (Rs 15,000 crore), permission to offer services such as non-voice messages and data services (Rs 1,500 crore) were the other benefits given to cellular operators, the basic service companies claimed.

Sundry other benefits like a six-month waiver on licence fee payment, direct interconnection with other service providers, and permission to provide STD PCO services amounted to another Rs 7,322 crore (Rs 73.22 billion), the basic service providers pointed out.

On the other hand, the cellular firms said the basic operators were given a concession of over Rs 45,000 crore (Rs 450 billion) in the form of free spectrum of 5 MHz. They also claimed that the basic operators were given a waiver of Rs 25,748 crore (Rs 257.48 billion) while migrating to the revenue share regime, against Rs 4,316 crore (Rs 43.16 billion) for the cellular operators.

The cellular operators pointed out that the government increased the licence period for the basic service operators from 15 years to 20 under the new national telecom policy. Therefore, the fixed-line operators paid only Rs 1,649 crore (Rs 16.49 billion), compared with the Rs 58,804 crore (Rs 588.04 billion) they would have had to pay under the earlier policy.

The cellular firms said limited mobility operators were silent on the fact that the ad interim revenue share worked out for all service providers on August 1, 1999, as a result of the migration package, was 15 per cent.