India’s wireless auction to raise Rs 210 billion
India's auction of wireless spectrum reclaimed after a corruption probe into the award of licenses may raise 53 percent of the government's target as prices deter billionaires from Russia to Malaysia.
The auction of secondgeneration airwaves set to start on Nov. 12 may raise 210 billion rupees ($ 3.9 billion), according to an average estimate of five analysts survey.
Finance Minister Palaniappan Chidambaram said Oct. 29 the government expects the sale to raise 400 billion rupees.
Companies controlled by billionaires Vladimir Evtushenkov, T. Ananda Krishnan and Anil Ambani are staying away from the sale fol- lowing the government's decision to start bids at $2.6 billion as it seeks to bridge a budget deficit.
Just five of the nation's 13 operators are in the fray, signaling investor concern about intensifying competition and the fallout from India's biggest corruption probe.
" The government might now take a slightly more realistic view of the reserve price," said Mohammad Chowdhury, telecom practice leader at PricewaterhouseCoopers.
"There's huge demand for spectrum, but it just means that at this price, nobody can buy it. It's partly the extremely high reserve prices and also the distress the industry is under because of a lack of ability to finance further investments."