The stage is set for a mega spectrum sale with the Union Cabinet giving a go-ahead to auctions across seven bands. The sale will see the government put around 2,300 MHz of spectrum on sale -the highest-ever in a single auction -which is likely to fetch the exchequer at least Rs.5.5 lakh crore if all the mobile airwaves are sold at the reserve price.
There could be a minor delay in the auctions as the Cabinet decided to seek telecom regulator Trai's opinion on the contentious issue of spectrum usage charge (SUC). The move could result in a delay in the issuance of the notice inviting applications for the auctions as Trai is expected to take some time in finalizing its views on the matter.
While the Telecom Commission -the inter-ministerial panel that is the supreme body on decisions on telecom matters -had suggested a flat 4.5% rate for spectrum acquired across bands at various points in time, a development that would have seen a hike in Mukesh Ambani's soon-to-be-launched Reliance Jio's charge (against the existing 1% in the 2,300 MHz band), the decision was not supported by the Attorney General.
Telecom minister Ravi Shankar Prasad said that the Cabinet had decided to take the opinion of Trai on the matter. It must be noted here that the regulator had in 2013 recommended a flat 3% SUC rate on all kinds of spectrum, but this was never accepted.
On the other hand, the telecom commission had earlier this month recommended a 3% SUC rate for the upcoming auctions, while suggesting a weighted average formula for the airwaves bought previously at other rates.