Can garner more than Rs 40k cr via spectrum sale, says Farooqui

Telecom dept may put more than 400MHz of airwaves on block for commercial use

The Department of Telecommunications (DoT) is hopeful of garnering much more than Rs 40,000 crore from the coming telecom spectrum auctions, as it expects all the spectrum to be sold at competitive bids, DoT Secretary M F Farooqui has said.

“We are very confidant this auction will be successful and the entire quantum of spectrum to be auctioned will be sold,” Farooqui said, after announcing the eighth edition of the ‘India Telecom’ summit, to be organised by DoT and the Federation of Indian Chambers of Commerce and Industry here from Thursday to Friday. He added the final merger and acquisition (M&A) guidelines would be announced before the coming auctions.

Successful bidders will be given the option of deferred payments. Earlier, Farooqui had said the government had set a target to garner more than Rs 11,300 crore from the auction of radiowaves in three bands — 1,800 MHz, 900 MHz and 800 MHz.

In November last year, the government could earn only Rs 9,407.64 crore by auctioning 1,800 MHz spectrum. Though the government had auctioned 176 blocks (1.25 MHz each) of the 198 blocks, it managed to get bidders for just 101.

DoT, which has decided to auction the highest available quantity of spectrum in January 2014, is likely to put more than 400 MHz of airwaves on the block for commercial use. In its submission to the Telecom Regulatory Authority of India (Trai), DoT had earlier said it wanted to auction the 285 MHz of spectrum in the 1,800 MHz band for which it couldn’t attract bidders in the two previous auctions.

The department has also identified additional spectrum to be allocated for commercial use by private cellular operators.  This would be out of the spectrum DoT had kept aside for refarming of the 900-MHz spectrum band. Initially, it was proposed 2.5 MHz spectrum in each circle would be reserved for each of the existing 900 MHz spectrum holders whose airwaves would be refarmed. According to the Trai data, 35 licences in the 900 MHz band across 21 circles will be due for renewal between 2014 and 2016.

As the government has decided to do away with reservation for refarming, an additional 87.5 MHz of spectrum in the 1,800 MHz band will be available to be auctioned in January.

Besides, 27.8MHz of spectrum in 1,800MHz band is with 15 licencees, whose licences will be due for renewal between 2015 and 2016, have 27.8MHz of spectrum in non-metro circles, which can also be auctioned.