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Montek favours lower reserve price for spectrum

Press Trust of India
Apr 11, 2013 at 01:07am IST

New Delhi: Planning Commission Deputy Chairman Montek Singh Ahluwalia on Wednesday said the benchmark price for spectrum auction is "unrealistic" and favoured lowering of reserve price as the previous two attempts to sell airwaves were "unsuccessful".

"Spectrum is a national resource. We had two unsuccessful attempts to auction it. It's quite clear that reserve price is too high.

"What actually I suggested is that we have a choice, we can arbitrarily lower the reserve price or we can refer the matter back to (regulator) Trai. My personal view is that it's better to get a recommendation from Trai ...the benchmark is some unrealistic price and it won't lead to a solution." He said at launch of European Business Group position paper.

Montek favours lower reserve price for spectrum

Government in the previous two rounds of spectrum auction was able to sell airwaves for around Rs 13,000 crore.

Government in the previous two rounds of spectrum auction was able to sell airwaves for around Rs 13,000 crore. The government has plans for third round of spectrum auction and may put on block 2G GSM airwaves in Delhi and Mumbai circles and CDMA spectrum in 13 circles that remained unsold in the previous sale held in March, sources said.

The government earlier had said that it would conduct the third round of auction putting on block all 2G spectrum freed from cancellation of 122 licences, after the Supreme Court in February this year ordered the DoT to auction entire spectrum freed.

Sources said the DoT would move a proposal to the Empowered Group of Ministers, headed by Finance Minister P Chidambaram, for the third round of auction. As per DoT's plan for the third round of auction, pan-India 2G spectrum in 1800 Mhz frequency band will be put for auction.

The Department of Telecom (DoT) is, however, yet to decide on the quantum of CDMA spectrum that would be auctioned in 13 circles, sources said. The government had put on sale 271.25 Mhz of spectrum in November 2012 against 473.6 Mhz of spectrum, including 60 Mhz of CDMA spectrum, that was freed after the Supreme Court order in February 2012.

Later, responding to reporters' queries on ADB growth projections, Ahluwalia said: "They think it's going to be 6 per cent this year. That's actually a turnaround." The government has been saying that there would be a turnaround in economy and GDP growth will over 6 per cent in 2013-14 against projected 5 per cent last year.

"That is roughly what they (ADB) are agreeing and we are agreeing too that growth rate in 2013-14 will be significantly better than in the previous year," he said.

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