NDA Govt Cabinet Approves 2G Spectrum Allocation,expected to raise 64480 Crores Monday Jan 05,2015

 

The Union Cabinet on Monday Jan 05,2015 approved the largest ever telecom spectrum auction that is targeted to fetch at least Rs.64,840 crore

The NDA Government will sell 380.75 megahertz of second generation (2G) spectrum in 3 bands -

•  800 MHz
•  900 MHz and 
• 1800 MHz. 

The Cabinet, headed by Prime Minister Narendra Modi, approved a reserve price of -
“Rs.3,646 crore pan-India per MHz in 800 MHz
Rs.3,980 crore for 900 MHz band pan-India excluding Delhi, Mumbai, Kolkata, and Jammu & Kashmir; Rs.2,191 crore pan-India (excluding Maharashtra and West Bengal) in 1800 MHz band

 The reserve or auction start price approved on Monday is the same as the one recommended by the Telecom Commission, except in the case of 900 MHz. The Telecom Commission had proposed a reserve price of Rs.3,695 crore for each MHz in 900 Mhz. Against this, the Cabinet approved the reserve price of Rs.3,980 crore

In 800 MHz band, 103.75 MHz in all service areas is being put on auction while 177.8 MHz in 900 MHz band is being sold in 17 telecom circles or service areas. 99.2 MHz will be auctioned in 15 circles in 1800 MHz band, it said.

There are total 22 telecom service areas in the country, and the price of spectrum in each circle is different

Spectrum in 2100 MHz may also be put on auction simultaneously after Defence Ministry vacates it. 
The reserve price for 2,100 MHz was not announced.

As per the tentative timelines drawn by the Department of Telecommunications (DoT)-

• Last date for submission of application is February 2, 2015
• Bidders will be pre-qualified by February 13,2015. 
• The auction will start on February 23,2015

Successful bidders have to pay within ten days 33 % of the final sale price in case of 1800 MHz. The same is 25 % in case of 900 MHz and 800 MHz

Proceeds from this year’s auction will help government reach its fiscal deficit target of 4.1% of GDP

Note

The 900 Mhz and 1800 Mhz band are used for providing GSM based mobile services  

The 800 Mhz band is used for CDMA based mobile services

The UPA Government had garnered about Rs.62,162 crore from the last auction in February, 2014

At the reserve price of last auction, airwaves were valued at about Rs.48,685 crore. The government had put on the block about 385 MHz of radiowaves in 1800 MHz band, and 46 MHz in 900 MHz band. During that auction, all spectrum in 900 MHz band got sold but 78 Mhz in 1800 MHz band remained unsold