India’s cabinet has approved the reserve prices for what will be the market’s largest spectrum auction yet, which is expected to generate up to $85 billion in revenues for the government.
A cabinet meeting chaired by Prime Minister Narendra Modi has approved pan-India reserve prices for spectrum blocks in seven bands, the India Timesreported. But a decision on the controversial issue of spectrum usage charges has been deferred.
The government plans to auction more than 2,300 MHz of airwaves across the 700-MHz, 800-MHz, 900-MHz, 1800-MHz, 2,100-MHz, 2,300-MHz and 2,500-MHz spectrum bands.
Pani-India reserve prices recommended by the Telecommunications Regulatory Authority of India range from 8.17 billion rupees ($121.14 million) for spectrum in the 2,300-MHz and 2,500-MHz bands, up to 114.8 billion rupees for spectrum in the 700-MHz band.
Trai had also recommended base prices of 28.73 billion rupees for 1,800-MHz, 33.41 billion rupees for 900-MHz, 37.46 billion rupees for 2,100-MHz and 58.19 billion rupees for 800-MHz.
At these prices the government expects to raise as much as $83 billion from the auction, close to five times the previous record of $17.6 billion set during last year’s mega auction.
Asked whether the auction will be able to reach the kind of heights the government is expecting, communications minister Ravi Shankar Prasad commented that there is strong demand for spectrum among India’s telecom sector.
The auction is also expected to help operators address the issue of call drops and help meet the government’s Digital India targets.