New telecom service providers will have to bid for a minimum of 5 MHz of spectrum in the 1,800 MHz band in the upcoming 2G spectrum auction. They can acquire up to 6.3 MHz of spectrum, according to the information memorandum released by the Department of Telecommunications (DoT).
Existing operators will also be allowed to bid for up to 2.5 MHz of spectrum in the 1,800 MHz band. In the 800 MHz band, used for providing CDMA-based mobile services, the companies will be allowed to bid for up to 3.8 MHz of spectrum.
No trading of spectrum will be allowed at this stage, according to the information memorandum.
The government will first auction airwaves in the 1,800 MHz band, that is used by GSM-based mobile service providers. Once, it is complete, the auction process for the 800 MHz band, used for CDMA-based services will start.
"A unified licence (UL) can be awarded to an Indian company only, with a maximum foreign equity of 74% as per guidelines. Hence, foreign entities desirous of participating in the auction(s) will need to form an Indian company accordingly to obtain a UL," said the memorandum.
The DoT has fixed a base price of Rs 14,000 crore for 5 Mhz of pan-India spectrum in the 1,800 MHz band and Rs 14,000 crore for 3.8 MHz in the 800 MHz band.