After a dud 2G spectrum auction last month, it looks like the empowered group of ministers (EGoM) has decided to lower the reserve price by 30% for the Delhi, Mumbai, Karnataka and Rajasthan circles in 1800 MHz band, which didn’t attract any bidders, reports Business Standard.

This follows earlier reports of Department of Telecommunication (DoT)’s plans to ask Telecom Regulatory Authority of India (TRAI) to re-price the current reserve price of Rs 14,000 crore for 5MHz spectrum.

Following this reduction, the government has set a new reserve price of Rs 12,000 crore for a block of 5 MHz of spectrum in the 1800 MHz band on a pan-India basis as against Rs 14,000 crore prior to the auction, as indicated by the report.

Circle-wise, the new reserve price for Delhi has been set at Rs 485 crore as against Rs 693.06 crore prior to the auction, while the new reserve price for Mumbai has been set at Rs 475 crore as against Rs 678.45 crore earlier. The new reserve prices for Karnataka and Rajasthan stood at Rs 231 crore and Rs 47 crore respectively, as against Rs 330 crore and Rs 67 crore earlier.

In addition to this, Telecom minister Kapil Sibal stated that EGoM has decided to auction spectrum in the 900 MHz band in Delhi, Mumbai and Kolkata and both the auctions will be conducted simultaneously, as indicated by the report, although he didn’t disclose any base price of the spectrum in those circles. Sibal also added that EGoM hasn’t taken any decision on the auction of the CDMA spectrum in the 800MHz band yet.

Sibal stated that they are currently seeking the cabinet’s approval on the reduced pricing and they plan to complete the auction process within this financial year.

2G Auction: Last month, the Government was able to sell only 42.37% of the total spectrum that was put up for the 2G auction and had raised just Rs 9,407 crore, as against its initial target of Rs 40,000 crore and minimum target of Rs 28,000 crore. Most new telcos who had received spectrum during the infamous 2008 “allocation” and incumbents including Tata Tele, Reliance Communications and MTS chose not to participate in the auction.


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With Input from Apurva Chaudhary