February spectrum sale expected to garner at least Rs65,000 cr

The Indian government expects to garner at least Rs65,000 crore from the auction of mobile spectrum in February, as the cabinet has approved prices for all bands except those in the 3G frequency.

The government's earnings from the sale may be boosted by a go-ahead for selling off 5MHz of 3G airwaves.

The union cabinet cleared the sale of spectrum that will see airwaves being sold in the GSM bands of 900 MHz, 1,800 MHz and 2,100 MHz (3G) and also in the CDMA frequency of 800 MHz.

It approved prices for all the bands but for the 3G frequency where the Telecom Regulatory Authority of India has proposed a reserve price of Rs2,720 crore per megahertz - but the inter-ministerial telecom commission is yet to arrive at a final price.

Reports said the government will seek to include 3G airwaves in the February auctions as it wants to boost the availability of spectrum.

These are just the reserve prices, and the bids would be higher considering that some of the top operators like Bharti Airtel and Vodafone need to buy spectrum in some circles to ensure continuity of operations.

Telecom minister Ravi Shankar Prasad's talks with defence minister Manohar Parrikar have resulted in freeing up 5MHz of 3G spectrum from the armed forces, and talks are on to get another 15MHz from them, though this may not happen by February.

The pan-India per megahertz reserve price approved for the 800 MHz CDMA band is Rs3,646 crore, for the 900 MHz band Rs3,980 crore (excluding Delhi, Mumbai, Kolkata, and J&K) and for the 1,800 MHz band Rs2,191 crore (excluding Maharashtra and West Bengal).

The quantum of spectrum to be put to auction is 103.75 MHz in 800 MHz band, 177.8 MHz (in 17 circles) in the 900 MHz band and 99.2 MHz (in 15 circles) in the 1,800 MHz band.

"Thus a total of 380.75 MHz in 800, 900 & 1,800 frequencies is being put to auction. The 3G pricing will also be worked out soon," Prasad said. The collections through the sale will help the government which has seen struggling to control fiscal deficit at 4.1 per cent of GDP.