DoT to seek Trai view on allocating spectrum to Railways without auction

The 700 MHz band is earmarked for mobile services and allocating it to Indian Railways for non-commercial use may adversely impact levies

The Digital Communications Commission on Tuesday directed the Department of Telecommunications (DoT) to seek views from the Telecom Regulatory Authority of India (Trai) on the allocation of 700 MHz premium spectrum worth Rs 65,000 crore to the Railways for signalling purposes without auction.

"Indian Railways has asked for 10 MHz of spectrum in 700 MHz band for setting up public safety and security service. The Digital Communications Commission has decided that the DoT should take views of Trai in the matter," Telecom Secretary Aruna Sundararajan told reporters after the first meeting of the Digital Communications Commission (DCC) this year.

The radio waves in 700 MHz band are considered a premium for long-distance mobile communications as they require less number of mobile towers to provide services compared to 3G and 4G services. Trai has recommended base price of Rs 6,568 crore per megahertz of radiowaves in 700 MHz band, implying the total value of airwaves at Rs 65,680 crore at the reserve price. The frequency band is earmarked for mobile services and allocating it to Indian Railways for non-commercial use may adversely impact levies like adjusted gross revenue, spectrum usage charges and licence fee. Besides, the DCC, formerly Telecom Commission, in its meeting also decided to allow Telecommunications Consultants India Limited (TCIL), the government's engineering and consultancy firm, to raise funds by diluting 25 per cent stake.

“The DCC decision is in line with that of the Cabinet Committee on Economic Affairs to disinvest 25 per cent in the company. TCIL had requested to carry on piggyback transactions of 10 per cent, which the DCC approved. TCIL has been allowed to retain funds raised from 10 per cent stake sale for working capital and the money raised from the sale of the rest 15 per cent will go to the government," Sundararajan said.

In a move to boost the setting up of VSAT-based network, the DCC reduced entry fee on VSAT to Rs 15 lakh from Rs 30 lakh, and waived a fee of Rs 16 lakh that organisations required to pay for each VSAT hub thereafter.