Cash-strapped Modi govt eyes Rs 65,000 cr jackpot from spectrum auction

New Delhi: The cabinet on Monday approved the proposal of the Department of Telecom (DoT) to proceed with auction in 800, 900 and 1800 MHz (mega hertz) bands and finalised its reserve prices, an official statement said.

 Cash-strapped  Modi govt eyes Rs 65,000 cr jackpot from spectrum auction

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"The reserve price approved is Rs 3,646 crore pan-India per MHZ in 800 MHz, Rs 3,980 crore for 900 MHz band pan India excluding Delhi, Mumbai, Kolkata, and Jammu and Kashmir; Rs 2,191 crore pan India (excluding Maharashtra and West Bengal) in 1800 MHz band," the statement said.

The quantum of spectrum to be put to auction is 103.75 MHz in 800 MHz band in all service areas, 177.8 MHz in 17 licence service area (LSA) in 900 MHz band and 99.2 MHz in 15 LSAs in 1800 MHz band. Thus a total of 380.75 MHz in 800, 900 and 1800 MHz is being put to auction, it added.

"The estimated revenues from this auction are Rs 64,840 crore (excluding 2100 MHz spectrum) of which Rs 16,000 crore is expected to be realised in the current financial year," the statement said.

The auction is due in February. The revenue target from spectrum auction set by the government in the 2014-15 budget is Rs 45,471 crore.

The DoT has selected Kolkata-based mjunction services for conducting the upcoming spectrum auction.

In December 2015, seven licences each of Idea Cellular and Reliance Communications, four licences of Bharti Airtel and six licences of Vodafone will complete their 20-year term after which they have to be renewed.

"Payment terms, eligibility criteria and auction objectives shall be as in the previous auction of February 2014," the statement said.

In February 2014, in a 10-day auction of 900 MHz and 1,800 MHz, the government mopped up Rs 61,162 crore.

Regarding auction of 2100 MHz or 3G spectrum, the statement said: "Cabinet also decided that intent to put 2100 MHz to simultaneous auction may be announced along with auction of other bands. Details of this will be announced later on."

According to a report in The Times of India, the decision to auction 3G spectrum simultaneously has been taken to increase the availability of the scarce resource. Otherwise, the government fears, speculation may bump up the bid prices at the auction.

The report also said that while Trai has recommended a reserve price of Rs 2,720 crore per mHz, the Telecom Commission is yet to arrive at a final price. This is the reason the government has held back the details of the 3G auction for now.

With inputs from IANS

Updated Date: Jan 06, 2015 10:47:58 IST