New Delhi: Eager to conduct simultaneous auction of 2G and 3G telecom airwaves, the Department of Telecommunications (DoT) is likely to approach the Cabinet by January 15 for pricing of 3G spectrum.
The Cabinet on Monday approved the starting prices for auctioning 2G bandwidth to cellphone operators that at the minimum price will fetch Rs 64,840 crore. Auction of airwaves vacated by Defence in the 2,100 MHz band is to be conducted simultaneously.
Sources said the DoT is likely to bring a proposal before the Cabinet on the reserve price and other matters relating to the 2100 MHz band, used for 3G services, by January 15, so that auction of this band is undertaken simultaneously along with other bands.
The Defence Ministry has agreed to vacate 5 MHz spectrum in 2100 MHz band, that will be auctioned in the upcoming sale. Inter-ministerial panel Telecom Commission (TC) has decided to send back Trai's recommendations on 3G spectrum pricing for a reconsideration.
The DoT will decide on the price after getting the response from Trai. As per the practice in place, Trai has to send back its final comments in 15 days but the authority can also send comments earlier. The Telecom Regulatory Authority of India (Trai) on December 31 had recommended a base price at Rs 2,720 crore per megahertz.
An internal committee of the DoT is believed to have suggested fixing base price of 3G spectrum at Rs 3,899 crore per megahertz, about 43 per cent higher than the rate recommended by Trai. "The committee is of the view that market determined price of 2010 should be indexed using SBI PLR and 80 per cent of that price can be fixed as reserve price for 2100 Mhz band (used for 3G services)," a source said.
The Trai, using SBI PLR, worked out the indexed price of Rs 4,874.59 crore per megahertz. Back of the envelope calculations show that 80 per cent value of indexed price will come to about Rs 3,899 crore/MHz.
In 2010, the final 3G spectrum rate paid by telecom operators was Rs 3,349.87 crore per megahertz.
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