Spectrum auction: Telecom Commission clears Rs 3700-cr base price for 2,100-MHz

The Telecom Commission (TC), the highest policy-making body of the department of telecommunications (DoT), on Monday approved a base price of Rs 3,700 crore for each MHz of 2,100-MHz spectrum to be auctioned on February 25.

The final reserve price is 36 per cent higher than the Rs 2,720 crore recommended by the Telecom Regulatory Authority of India (Trai). Now, the Union Cabinet is likely to meet this week and take a final call.

At a meeting on Monday, TC also decided that only five MHz of spectrum in the 2,100-MHz band will be put up for auctioning in the coming round. This should fetch the government a total of Rs 18,500 crore.

Besides 2,100-MHz, airwaves in the 800-, 900- and 1,800-MHz will also be put on the block in February. The government expects the auction round to garner a total revenue of Rs 80,000 crore to Rs 1 lakh crore.

TC had earlier rejected the Trai’s recommendation on the 2,100-MHz base price and referred it back to the regulator. But Trai last week refused to change its suggested price and sent it back to the department of telecommunications.

In the 3G auction of 2010, the final price paid by telecom operators totalled Rs 3,349.87 crore.

In its recommendations on the reserve price for 2,100-MHz spectrum, Trai had also suggested that the government auction 5+15 MHz of airwaves in this band in February. It had said the government could hold the auction simultaneously with other bands and specify a later date when the rest of 2,100-MHz spectrum could be made available for commercial use.

Communications and Information Technology Minister Ravi Shankar Prasad had, however, said the government intended to auction five MHz of 2,100-MHz spectrum in the coming round, and 15 MHz more when available it would be vacated by the defence services.

The telecom and defence ministries have, in principle, agreed to a swapping arrangement for release of 15 MHz of 2,100-MHz spectrum by defence services in exchange for a similar amount of 1,900-MHz airwaves. But the government is keen on auctioning only 5 MHz in the coming round as talks for vacation of spectrum are still on and actual swapping might take some time.

Source: Business Standard

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