Govt sets base spectrum price
4 Aug 2012 6:48 AM IST
The cabinet has fixed a minimum or base price of Rs 14,000 crore for the Supreme Court-mandated auction of telecom spectrum. The cabinet, headed by Prime Minister Manmohan Singh, decided to fix the reserve price at the lower end of the Rs 14,000 crore to Rs 15,000 crore band that was recommended by an Empowered Group of Minister [EGoM], official sources said.
The EGoM had suggested a reserve price at Rs 14,000 to Rs 15,000 crore for 5 Mhz of airwaves as against around Rs 18,000 crore recommended by the sectoral regulator Telecom Regularity Authority of India [TRAI] for the auction of spectrum vacated from the cancellation of 122 licences by the Supreme Court.
Sources said that the cabinet approved levy of annual spectrum usage charge of three to eight per cent on different slabs of revenue, as was recommended by the EGoM headed by P Chidambaram. Chidambaram has since been made the finance minister in a minor cabinet reshuffle.
In February this year, the apex court had cancelled 122 licences issued by the then telecom minister A Raja in 2008 and asked the government to conduct fresh auctions by 31 August. But, this deadline may not be met, and the government may have to approach the apex court for an extension of the deadline.
The reserve price fixed will come as a disappointment for the telecom industry which had been pitching for a 80 per cent cut in the reserve price suggested by TRAI, which, they felt, would lead to up to 100 per cent hike in mobile telephone charges.
The auction is crucial for the companies like Uninor and Sistema Shyam Teleservices, which have time till 7 September to start offering services, after which they will be forced to close down their operations in case they fail to get a licence.
The EGoM had suggested a reserve price at Rs 14,000 to Rs 15,000 crore for 5 Mhz of airwaves as against around Rs 18,000 crore recommended by the sectoral regulator Telecom Regularity Authority of India [TRAI] for the auction of spectrum vacated from the cancellation of 122 licences by the Supreme Court.
Sources said that the cabinet approved levy of annual spectrum usage charge of three to eight per cent on different slabs of revenue, as was recommended by the EGoM headed by P Chidambaram. Chidambaram has since been made the finance minister in a minor cabinet reshuffle.
In February this year, the apex court had cancelled 122 licences issued by the then telecom minister A Raja in 2008 and asked the government to conduct fresh auctions by 31 August. But, this deadline may not be met, and the government may have to approach the apex court for an extension of the deadline.
The reserve price fixed will come as a disappointment for the telecom industry which had been pitching for a 80 per cent cut in the reserve price suggested by TRAI, which, they felt, would lead to up to 100 per cent hike in mobile telephone charges.
The auction is crucial for the companies like Uninor and Sistema Shyam Teleservices, which have time till 7 September to start offering services, after which they will be forced to close down their operations in case they fail to get a licence.
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