This week's pictures of serpentine queues to buy Nepal Telecom's pre-paid mobile phones cards shows that just divesting shares of a parastatal may not change its mode of functioning.
Some 50,000 SIM cards were sold in a few days and Nepali rent-seeking behavior was at its peak. When people didn't want to be in the queue, they could get cards by paying an expediting fee to Telecom employees, who were busy buying and selling cards at a premium.
Nepal Telecom was converted into a company but government diktats still prevail. No surprises there. Ministers have made noises about the privatisation process, but nothing has happened. But just offloading a percentage of shares to employees and the public does not change a company's strategic direction. The government must give thought as to whether it wants to preoccupy itself in running utilities when it has the much more urgent business of restoring peace to handle.
Telecom services in the region have grown at a phenomenal pace with consumers getting an array of services that they could not even dream of a few years ago. Messaging services in India are now a marketing tool and services over the mobile phones may be as extensive as the Internet. From managing virtual private networks to dating services, telecom companies add a few things every week to the bouquet of offerings. This has given opportunities for many enterprises that support these services or use these services as their backbone.
When telecom businesses are privately owned, it triggers an exponential growth in the economy. In Nepal, apart from the Indian state-owned consortium that has a presence, there isn't much from the private sector. License owners are more happy to sit on their licenses and look for the highest bidder than to turn the licenses into a legitimately lucrative business. The only private cellular license holder just gave assurances it will start the business following stories in the media that the license had changed hands.
The government has demonstrated just how poor a regulator it is when it couldn't even take action against the private license holder who did nothing with the permit for years. The so-called 'apex bodies' of the private sector didn't utter a peep about this to put pressure on the government to grant more licenses or on privatising Nepal Telecom.
If Nepal's pace of development is to accelerate, telecom services need to have greater affordability and accessibility and that can only come by levelling the playing field and allowing competiton. The Nepali consumer has the right to get world class service at the best prices. This requires more players in the market to meet demand and help create more demand for the industry as a whole. The private sector needs to work hard to pressurise the government to create the regulatory framework for more players, as well as to get the government out of the telecom business. Otherwise we will see more serpentine queues in the future and our mobiles will always say: network busy.