In­dia’s govt to be­gin 2G tele­com spec­trum auc­tion to­day

The Pak Banker - - Front Page -


In­dia’s govt will be­gin to­mor­row the auc­tion for tele­com spec­trum through which it is hop­ing to meet Rs 40,000 crore rev­enue tar­get.

The auc­tion for the air­waves or fre­quen­cies freed from the can­cel­la­tion of 122 tele­com li­censes, be­long­ing to mainly eight com­pa­nies, by the Supreme Court in Fe­bru­ary, will start at 0900 hours on Mon­day. We have taken quick de­ci­sion, firm de­ci­sions in the tele­com sec­tor. The re­sult of which is that we are in process of auc­tion. 12th of Novem­ber that auc­tion will start, In­dia’s Tele­com Min­is­ter Kapil Sibal said at an event on Mon­day.

The can­celled per­mits in­cluded Uni­nor’s 22 li­cences, Loop Tele­com (21), Sis­tema Shyam (21), Idea Cel­lu­lar in­clud­ing Spice Com­mu­ni­ca­tions (13), Video­con (21), Eti­salat DB for­merly Swan Tele­com (15), S-Tel (6) and Tata Te­le­ser­vices (3 CDMA li­cences). In­stead of auc­tion­ing en­tire spec­trum freed from can­cel­la­tion of li­cences, the In­dian govt is auc­tion­ing a max­i­mum of 11 blocks of air­waves fre­quen­cies in each circle, bar­ring Delhi and Mum­bai where there are only eight blocks, to at­tract high price for spec­trum.

The apex court had al­lowed the com­pa­nies, whose per­mits were can­celled, to get spec­trum re­al­lo­cated for con­tin­u­ing their busi­ness if they win rights for the air­waves fre­quen­cies in the auc­tion. In­dia’s govt has fixed start­ing price for spec­trum in the auc- tion at Rs 14,000 crore for 5 Mhz of GSM spec­trum on pan-In­dia level which is around 7 times more than the price of Rs 1,658 crore at which tele­com com­pa­nies were given pan-In­dia per­mits be­tween 2001 to 2008. Comp­trol­ler and Au­di­tor Gen­eral has es­ti­mated that al­lot­ment of per­mits in 2008 at 2001 prices caused loss to gov­ern­ment ex­che­quer to the tune of around Rs 1,76,000 crore.

Cit­ing rec­om­men­da­tions of Tele­com Reg­u­la­tory Author­ity of In­dia (Trai) to fix min­i­mum price of CDMA spec­trum at dou­ble the price of GSM spec­trum, Sibal said that the Em­pow­ered Group of Min­is­ters’ re­alised that there will be no taker for these air­waves at Rs 28,000 and hence it low­ered it to 1.3 times in­stead of dou­ble price.

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