'Defence must give DoT 3G spectrum'

Can deliver revenue by February if auction goes smoothly, he tells FM in letter.

Communications Minister A Raja has shifted responsibility for holding auctions for third generation or 3G telecom services to Finance Minister Pranab Mukherjee by requesting him, in a letter last week, to ensure that the defence ministry releases the spectrum it had promised on time.

The defence ministry was supposed to release 20 MhZ of spectrum, radio frequencies that enable mobile communications, in December, ahead of 3G auctions that were originally scheduled for the same month. In September, the defence ministry said it would not be able to release the spectrum before June next year because it wanted time to test an alternative network that state-owned Bharat Sanchar Nigam was building.

Raja's letter to Mukherjee was written on October 26, two days after the Department of Telecommunications (DoT) released a revised information memorandum (IM) fixing January 14 to 24 as the deadline for completing the 3G auction.  The IM was originally supposed to have been issued on September 29.

The revised IM, in turn, was issued after Mukherjee, who heads a government panel on 3G policy, wrote a strongly-worded letter to Raja in mid-October pulling him up for delaying the 3G auction and directing him to resolve all outstanding issues.

The auction of 3G licences, each of which comes bundled with spectrum, is expected to net the government revenue of over Rs 30,000 crore, which is critical in a year in which it faces a record fiscal deficit of 6.8 per cent of Gross Domestic Product this financial year. 

Raja, in his letter, has also told Mukherjee that if the IM is followed the revenue to the government from 3G spectrum would be available by February 12 and from broadband wireless access by 28 February 2010, well before the financial year ends. 

Writing to Mukherjee to ensure that the new auction schedule is not “disrupted”, Raja requested the finance minister to sort out differences with the ministry of defence so that the exact amount of spectrum frequency available in each circle can be identified by the first week of December and incorporated in the tender notice to be issued on December 8 . 

Although some circles have enough spectrum for five 3G operators there are many like in Delhi, Rajasthan and West Bengal that have either none or spectrum to support only one or two players and, therefore, depend on how much is vacated by the ministry of defence.

 

Also read:
October 22: No delay in 3G auction possible, Pranab tells Raja