2G auction in 4 circles may come up in Cabinet tomorrow

The Cabinet may take a call on reducing reserve price for spectrum sale for 2G services in four circles---Delhi, Mumbai, Rajashtan and Karnataka -- by 30% following lacklustre response earlier.

The empowered group of ministers (EGoM) on telecom is understood to have favoured a 30% reduction in the auction prices of airwaves in the 1800 mhz band after the initial auction earlier this year failed to attract bidders.

The reserve base price for Delhi was Rs 693.06 crore, Mumbai Rs 678.45 crore, Karnataka Rs 330.12 crore and Rajasthan at Rs 87 crore. These four circles account for, at least, half the base price for pan-India licences, which was fixed at Rs 13,850 crore.

Last month, the Government was able to sell less than 50%  of the total spectrum that was put up for the 2G auction and had raised just Rs 9,407 crore, as against its initial target of Rs 40,000 crore.

Telecom minister Kapil Sibal had indicated that currently the ministry is seeking cabinet’s approval on the reduced pricing and they plan to complete the auction process within this financial year.