The 2G spectrum auction has concluded after 10 days of intense bidding by eight players. The government has received total bids worth Rs 611.62 billion against the expected bids of about
Rs 479.33 billion.
Terming the auction as ?extremely successful?, Kapil Sibal, Minister of Telecommunications and IT, said, ?The government will receive total revenues worth Rs 611.62 billion, to that extent, the auction has been extremely successful.? He added, ?The auction will really be successful if we are able to provide efficient service to consumers. The ultimate objective of auction is to ensure that the service is provided efficiently and at a relatively affordable price. We expect that the tariffs will remain reasonable in the years to come.?
With the successful conclusion of the auction, the government will get revenues worth Rs 182.96 billion in 2014 against the initial projection of Rs 113.4 billion. At the end of the spectrum auction, the value of spectrum in the 900 MHz band put up for auction in the three circles – Delhi, Mumbai and Kolkata stood at Rs 235.89 billion (85 per cent higher than the value of the reserve price). In the 900 MHz band, operators including Bharti Airtel and Vodafone India, whose licences are to expire in November 2014 managed to acquire the required spectrum to ensure uninterrupted services to their subscribers.
In the 1800 MHz band, spectrum was available in all the 22 circles and the net value of the spectrum stood at Rs 375.72 billion. The government managed to auction the entire 46 MHz of spectrum in the 900 MHz band, however 78 blocks of the 390 MHz spectrum in the 1,800 MHz band remained unsold. In the 1,800 MHz band, the top three circles in terms of net value are: Delhi (Rs 76.44 billion), Mumbai (Rs 63.64 billion) and Maharashtra (Rs 40.64 billion). While Assam circle clocked the highest value for spectrum in percentage terms ? Rs 4.11 billion which is 515 per cent over its reserve price of Rs 0.79 billion.
According to M. F. Farooqui, secretary, Department of Telecommunications, the government does not foresee any impact on tariffs because the operators would have factored in all aspects before bidding for spectrum. He stated, ?Market sentiment, economic situation and clarity in regulatory framework impact (spectrum) prices. We only provided transparent environment. Companies know their business better and if they have bid, they must have calculated the value of spectrum.?
