The Empowered Group of Ministers (EGoM), headed by P. Chidambaram, Minister of Home Affairs has permitted operators to use spectrum as collateral to raise funds from banks, say news reports.
According to the EGoM, the spectrum will be considered an asset and banks will have the rights to own or sell the spectrum in case the operators default on loans. The Department of Telecommunications (DoT) will oversee the sale of spectrum by banks.
Prior to this, the Ministry of Finance and the Reserve Bank of India had permitted banks to consider spectrum as an asset and provide loans to operators to help them raise money for auctions.
However, several issues remain unresolved. These include identifying the reserve price of spectrum and the one-time licence fee to be paid by operators for the remaining period of their licences.
Meanwhile, to expedite the process, DoT has put forward several suggestions on these subjects.
