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Trai begins consultation for 3rd round of spectrum auction

Telecom regulatory Authority of India (Trai) has sought views on various issues concerning the sale of spectrum

Written by ENS Economic Bureau | New Delhi | Published: July 24, 2013 1:29 am

Telecom regulatory Authority of India (Trai) has sought views on various issues concerning the sale of spectrum,which could not be sold in the auctions held in November 2012 and March this year.

Trai on Tuesday started fresh consultation process for valuation and reserve price of spectrum,which was termed ‘very high’ by the industry in the earlier two auctions.

“On July 10,2013,the Department of Telecommunications sought Trai’s recommendations on the applicable reserve price for the auction of spectrum in 800 Mhz (CDMA),900 Mhz and 1800 Mhz (GSM) bands. In this context,Trai has issued consultation paper,” Trai said.

The comments have been invited on the quantity of spectrum that should be kept for auction,time that winner of airwaves should be given to roll out network and the method to be used for valuation and estimation of reserve price.

Comments have also been sought on whether this is the right time to allow spectrum trading in India. This is despite the government’s view that this not the right time to start spectrum trading in India.

The regulator has sought view from parties interested in the process by August 14,counter comments by August 21. It will also hold an open house discussion on the subject on August 26.

A third round of spectrum auction are required to be held for 1800 Mhz in 20 out of 22 circles to comply with a Supreme Court order that has directed it to auction entire spectrum freed from cancellation of 2G licences in February 2012.

The government had put on sale 271.25 Mhz of spectrum in November,2012,including 60 Mhz of CDMA spectrum. As much as 473.6 Mhz of spectrum that was freed after the Supreme Court order in February last year.

The November auction could fetch government only a sum of Rs 9,407.64 crore against spectrum worth Rs 28,000 crore at base price.

The government again placed unsold spectrum worth Rs 45,000 crore for auction in March 2013 after reduction in base price,but only Sistema Shyam Teleservices made bids worth Rs 3,693 crore for CDMA spectrum.

Later,DoT proposed to Empowered Group of Ministers on spectrum to auction airwaves that remained unsold in both the rounds.

For the first round of spectrum auction held in November 2012,Trai had recommended around 11 times base price for telecom airwaves compared to the amount paid by companies in 2008.

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