Govt will hold another 2G auction by 31 March: Sibal

Telecom Minister Kapil Sibal and Finance Minister P Chidambaram used the debacle of the recent telecom spectrum auction to drive home the point that policy making ought to be left to the government.

At a press conference, Telecom Minister Kapil Sibal said the government intends to hold one more auction of 2G spectrum before 31 March. He, however, said all other details like whether the reserve price will be reduced and what the market determined price remains to be discussed.

Blaming the environment created by the 'extrapolation of figures' and 'sensationalism' for impeding the policy making capabilities of the government, Sibal said the estimated loss of Rs 1.76 lakh crore was a "pure myth", adding, "If we had been allowed to do what we have to do, and discharge our responsibilities properly, we wouldn't be in this situation".

Chidambaram and Sibal have defended the recent 2G spectrum auction. AFP

The ministers' press conference, which also saw Sibal wax eloquent about the murder of the hen that laid the golden egg as a metaphor for the decline of the telecom growth story, was conducted in an environment of barely concealed glee.

So much so in fact, that a journalist was prompted to ask the Telecom Minister if he was celebrating, to which Sibal responded, " I am not celebrating. I am upset that the consumer has not been able to benefit. I am sad".

However, the minister said it is wrong to say that the 2G auction was a failure as the process is not yet over.

Finance minister P Chidamabaram also refuted claims that the government may not have any net gain from the auction, as there is a substantial amount of refund the government needs to make to telcos whose licences were cancelled.

They said the government will see an inflow of Rs 17,343 crore, including the one-time fee and the bids.

Taking this amount into consideration, the finance minister insisted the government will see a net gain, but said a final figure can be given only later.

The ministers refused to indulge in any number crunching, cautioning against sensationalism, as seen with the CAG's report on 2G spectrum.

However, Sibal said the government can still get Rs 27,000 crore from additional spectrum auctions this year.

When asked whether the government will still be able to meet the fiscal deficit target for the current financial year, Chidambaram replied in the affirmative saying there is more time left.