NEW DELHI (INDIA): The Associated Chamber of Commerce and Industry of India (ASSOCHAM) has said that the high reserve price of Rs 3,705 cr per MHz, which is 35% higher than the price recommended by TRAI, is rather unfortunate and has sought urgent review of the decision.
Yesterday, the Cabinet has approved the proposal of the Department of Telecommunication (DoT) to proceed with auction in 2100 MHz band along with 800, 900 and 1800 MHz bands.
The Union Cabinet has approved reserve price for 2100 MHz Band at Rs 3,705 crore pan-India per MHz.
“A 5 MHz block will be offered in all service areas except Jammu and Kashmir, Bihar, Himachal Pradesh, West Bengal and Punjab. Thus a total of 85 MHz in 17 Licensed Service Areas (LSAs) is being put to auction,” an official statement said. The Cabinet was chaired by Prime Minister Narendra Modi.
“This type of auction would leave less residual money in the hands of the operators for the expeditious rolling out of the much-desired expansion in the data services which are the need of the country for national economic development,” said T V Ramachandran, Telecom Council Chairman, ASSOCHAM.
He said, data services are growing 100% y-o-y and this resulting in a severe crunch on the requisite spectrum and impairing the quality of service to the customers.
He further said, concurrently, the high cost of spectrum could compel operators to raise retail prices for economic viability. Thus the public interest is impacted in more than one way due to the latest Cabinet decision.
ASSOCHAM and industry are also greatly perturbed that despite another 15 MHz of 2100 MHz spectrum having been agreed for swapping, this is not included in the auction quantity. It does not matter that it might take some more months, maybe a year, to harmonize and make the additional quantity available to operators.
Ramachandran said, even in the last two auctions, operators were compelled to wait for six months for the spectrum they had won.
If not reviewed, the chamber said, this decision will go against the government vision for “Digital India”, wherein of the nine pillars envisaged by the government, the first one is the broadband highway.
“A 5 MHz Block will be offered in all service areas except Jammu & Kashmir, Bihar, Himachal Pradesh, West Bengal and Punjab. Thus, a total of 85 MHz in 17 Licensed Service Areas (LSAs) is being put to auction,” the statement said.