Cellular Operators Association of India (COAI) on Tuesday said that the tariff for telecom services would increase by 30 paise per minute due to increase in spectrum prices, if the government accepts Telecom Regulatory Authority of India (TRAI) recommendations in auction.
The regulator, however, refuted COAI claims. "It is not correct. I maintain that the impact of new spectrum prices on tariff will not be more than 3 paise per minute," said JS Sarma, chairman of TRAI.
In its recommendations on the auction of spectrum submitted to the government last month, the TRAI proposed a reserve price of Rs. 3,622 crore per MHz, which is about 10 times more than the price at which old incumbent operators got spectrum.
The industry association said that the TRAI has not taken certain factors such as fall in demand for services as prices increase into account when calculating impact on tariff.
The chiefs of Bharti Airtel, Vodafone India, Idea Cellular, Uninor and Videocon had met telecom minister Kapil Sibal to on Tuesday discuss the implications of Trai recommendations.