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Spectrum enters new phase under Chidambaram

india Updated: Jul 12, 2012 02:34 IST
HT Correspondent
HT Correspondent
Hindustan Times
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The first meeting of the empowered group of ministers (EGoM) with the home minister P Chidambaram as its new head will be held on Thursday. The meeting will discuss the important issues of fixing reserve price of the spectrum for auction.

The government is running against a deadline of August 31 to auction the spectrum and complete the allocation process.

Chidambaram is the third chairperson, after former finance minister Pranab Mukherjee resigned to contest the presidential polls and agriculture minister Sharad Pawar stepped down, saying his name was being dragged into the ongoing 2G licences controversy.

The meeting assumes importance as the Telecom Regulatory Authority of India's (TRAI) new chairman Rahul Khullar will make a presentation on the impact of TRAI recommended spectrum price on consumers.http://www.hindustantimes.com/Images/Popup/2012/7/12_07_12-buss21b.jpg

His predecessor JS Sarma has recommended a reserve price of R18,000 crore for 5 MHz of spectrum in the 1800 MHz band.

Earlier, Khullar pointed out before JPC that 17 years ago the operators had bid R10,040 crore for 4.4 MHz of spectrum for 18 circles (except four metros) for a 10-year licence period.

If adjusted against inflation at 12.6% (prime landing rate of SBI), it will be valued at R75,832 crore. For a 20 year licence period, this amount should be at least double to it.

The EGoM will also consider imposing a one-time charge on all existing operators.

The EGoM's mandate on the key issue of the 2G scam - spectrum pricing - will be limited to giving recommendations to the Cabinet.

Meanwhile, in a letter to Chidambaram, Rajya sabha MP Rajeev Chandrasekhar said the government should either uphold TRAI's statutory recommendations on price, or provide valid, detailed and transparent reasoning in case of change, before implementing its decision.