Spectrum Auction Surpassed Revenue Target by 60 Per Cent at Rs 18,296 Crore
After badly missing revenue target for financial year 2012-13, the auction attracted bids worth Rs 62,162 crore and surpassed upfront payment target for current fiscal by 60 per cent at over Rs 18,296 crore. The government had put two spectrum band for auctions- 1800 Mhz , following Supreme Court order to auction all spectrum freed from cancellation of licences and 900 Mhz spectrum, held by licences of Vodafone, Airtel and Loop Mobile through their licences expiring in November 2014. The government expects to raise Rs 38,954 crore in the next financial year from communication services including proceeds from spectrum auction and related charges. In next fiscal starting April 1, 2014, government will auction about 165 megahertz of spectrum that are held by telecom operators whose licences are set to expire in December 2015. Vodafone Group and Bharti Airtel won critical wireless telecom spectrum in metros like Delhi and Mumbai and several other cities in an intensely fought 10- day auction that gave the government over Rs 61,162 crore, far exceeding its own target. Mukesh Ambani’s Reliance Jio Infocomm, which surprised by entering the fray despite owing pan-India 4G spectrum, bid aggressively for both the bands of airwaves on offer - the premium 900 Mega-Hertz and not so efficient 1,800 MHz, but choose spectrum only in the later band in 14 out of 22 circles. Vodafone, whose licence in Delhi, Mumbai and Kolkata is due to expire in November this year and desperately needed spectrum in the auction to continue operations, put in bids worth Rs 19,600 crore to win 900 MHz airwave in the three metros and 2G 1800 MHz spectrum in 11 circles or zones. Airtel, whose licences in Delhi and Kolkatta was due to expire in November, won back 900 MHz in both these metros and added the same in Mumbai. It also won 1,800 MHz spectrum in 15 circles. It put in total bid worth Rs 18,530 crore for a total of 115 MHz of spectrum in 900 MHz and 1800 MHz bands. Sunil Bharti Mittal-promoted firm said it would roll out panIndia 4G network using 1800 MHz. Idea was the only other company to win the 900 MHz spectrum, which is capable of 3G communications, in Delhi. In all the auction, which lasted 10 days, fetched the government Rs 61,162 crore, of which Rs 18,296.36 crore will flow to the exchequer within this fiscal. The government was initially expecting only Rs 11,300 crore of revenues to come from the spectrum auction in the current year. Uninor won spectrum in five circles in 1800 MHz band while Idea got 11 circles in the same band. Anil Ambani’s Reliance Communications won just one circle of 1800 MHz in Mumbai. Tata Communications drew blank. Aircel got 5 circles. “I am very happy to report that auction is over. The total revenue that will come to government is Rs 61,162.22 crore. To that extent particular auction has been extremely successful,” Telecom Minister Kapil Sibal said. On whether the strong bidding will impact mobile tariffs, Sibal said: “But this successful auction will really be successful if we are able to provide efficient service to consumers. “Ultimate objective if any auction which has to provide service is that service must be provided efficiently and at a relatively affordable price. We hope the tariffs will remain reasonable in the years to come.” The government had put on the block about 385 MHz of radiowaves in the 1800 MHz band, and 46 MHz in the 900 MHz band. At the base price, that cumulatively amounted to about Rs 47,933 crore. Telecom Secretary MF Farooqui said that bids worth Rs 37,572.60 crore had come in for radiowaves in 900 MHz band, and Rs 23,589.62 crore for 1800 MHz band.