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Suggested spectrum base price too high, says Ficci

Last Updated: Friday, May 11, 2012 - 22:01

New Delhi: Industry body Ficci on Friday said the base price of spectrum recommended by the telecom regulator Trai is "extremely high" and should rather be designed to serve overall national interests.

Saying that the reserve price needs to be based on sound techno-economic principles, Ficci said the suggested price of spectrum by sectoral regulator Trai is extremely high compared to its own earlier recommendations of February 2011.

"The spectrum auctions should be appropriately designed to serve the overall national and societal interests and to encourage faster rural roll out by operators," Ficci said in a statement.

The Telecom Regulatory Authority of India (Trai) has suggested a base price of Rs 3,622 crore for one megahertz (MHz). This is around 10 times higher than the price at which 2G licences were allocated in 2008 during the tenure of the then Telecom Minister A Raja.

Ficci said it is important that spectrum be made available at a reasonable price to ensure mobile phone tariffs continue to be affordable.

"The tariffs should continue to be affordable for the socio-economic benefits and inclusive growth. For achieving this, it is essential that the spectrum should be made available at a reasonable price," Ficci said.

In this regard, the recent Indian market experience on severe financial constraints being faced by the industry needs to be kept in view, it added.

The body also suggested that all available spectrum should be made open for upcoming auctions to avoid any artificial scarcity.

"If necessary, some spectrum should be released from other existing users. At the same time a fair chance should be afforded to all interested parties who are willing to participate in a transparent bidding process," it said.

Considering the current financial constraints of the telecom industry, Ficci said the Trai recommendations on deferred payment "seems much appropriate and may be accepted by the government".


First Published: Friday, May 11, 2012 - 22:01
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