Spec­trum sale cleared, phone tar­iffs may rise

Hindustan Times ST (Mumbai) - HT Navi Mumbai Live - - FRONT PAGE - HT Cor­re­spon­dent let­ters@hin­dus­tan­times.com

In­dia cleared on Wed­nes­day a mega telecom spec­trum auc­tion plan that can fetch the gov­ern­ment an es­ti­mated `5.6 lakh crore, but in­dus­try lead­ers cau­tioned that high prices could even­tu­ally force com­pa­nies to raise tar­iffs.

The move will make more spec­trum — ra­dio waves that carry telecom con­tent — avail­able for op­er­a­tors to of­fer high-speed data, help re­duce call drops, bol­ster the gov­ern­ment’s fis­cal po­si­tion, but could hurt com­pa­nies’ frag­ile bal­ance sheets by forc­ing them to bor­row more.

“This will be the largest auc­tion to date,” fi­nance min­is­ter Arun Jait­ley said dur­ing a press brief­ing af­ter the cab­i­net headed by Prime Min­is­ter Naren­dra FOR CONSUMERS Modi ap­proved the spec­trum auc­tion pro­posal. The gov­ern­ment was con­fi­dent that the prices will not be a hur­dle for the auc­tions to sail through.

“The ap­petite for In­dia’s telecom sec­tor is very big,” com­mu­ni­ca­tions and IT min­is­ter Ravi Shankar Prasad said.

More than 2,300MHz of air­waves will be on the block for telecom op­er­a­tors in seven bands — 700MHz, 800MHz, 900MHz, 1,800MHz, 2,100MHz, 2,300MHz and 2,500MHz. Based on their panIn­dia re­serve price, the rev­enues can be as much as `5.6 lakh crore.

A de­ci­sion on the so-called spec­trum us­age charge (SUC), a fee that telecom firms have to pay the gov­ern­ment ev­ery year, has been de­ferred with the cab­i­net re­fer­ring it back to the sec­tor watch­dog.

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