Followed by Indian Telecommunication corruption scandals, Pakistani telecom sector seems to be experiencing similar situation where everyone appears to be involved in order to safeguard each other’s interest.
Last week, Senator Zahid Khan had criticized Chairman Pakistan Telecommunication Authority, Dr. Muhammad Yaseen in a meeting of Senate Standing Committee on IT. The Senator was of the view that Chairman always evade the committee meetings in order to avoid answering the corruption and mismanagement related issues in the telecom sector. He further said that “Chairman is inefficient and always make lame excuses and take the plea that he has to attend the court session therefore, he is not available”.
Chairman PTA, who is already facing Rs. 50 billion cases in the Supreme Court has his name on the Exit Control List (ECL) as per PAC’s recommendations.
Committee which was chaired by Muhammad Idrees Khan Safi inquired from the representative of the IT Ministry including Secretary IT – Farooq Awan and Head of Universal Service Fund (USF) Riaz Ashraf Siddique about the mismanagement and favoritism in the awarding of telecom contracts to various firms. On which Farooq Awan replied that it is the responsibility of PTA and not the ministry to verify the credibility of telecom firms before a contract is awarded to them. When Riaz Ashraf was asked about certain USF projects including Noshky-Mastang and Ziarat he took the same stance and told that although, USF is an independent organization that is meant to extend the telecom related services to the areas where operators don’t reach but it is the duty of PTA to check the credibility of any telecom company before it is allowed to take part in the process of awarding contract.
The committee also raised serious questions on the working of Research and Development Fund (R&D Fund). Committee directed to call Pervaiz Rashid former CEO of R&D Fund in the next meeting on the grounds that majority of the projects initiated by the Fund are based on personal likes and dislikes. For example, out of 63 projects costing Rs. 997 million, 36 were initiated in the Islamabad territory whereas it is the job of Fund to implement development projects in the far flung areas of all provinces. Committee found that Baluchistan and Gilgit Baltistan provinces were the most ignorant part of the country during Pervaiz Rashid’s tenure.
Committee was told by Farooq Awan that Pervaiz Rashid suddenly left the job and went to Canada. A departmental inquiry has been started on his sudden disappearance and biased performance.
R&D Fund’s board comprises of 13 members who represent cellular operators, fixed line operator, ISPs, Academia and government of Pakistan.
The Committee directed Secretary IT to make sure that no contract is awarded to any telecom company which is a defaulter in terms of taxes and loans.
In another episode, National Accountability Bureau (NAB) has intervened and stopped FBR from giving tax waiver to cellular operators. According to details released by NAB, national exchequer was being deprived of Rs. 47 billion in terms of tax evasion by five cellular companies including NTC, Ufone, Telenor, Mobilink and Warid.
According to NAB, cellular operators have been evading taxes since 2007. FBR Auditors took notice of the matter in 2010 but FBR Chairman was in favor of issuing subject waiver to the cellular operators inspite of clear cut direction from NAB.
At eleventh hour, Chairman NAB took Suo Moto notice of the matter and refrained Chairman FBR from issuing any such waiver. A fact finding committee has been constituted in order to find out the details of tax evasion.