New Delhi, July 6: The Union cabinet will take the final call on spectrum auction reserve price and a one-time fee on existing telecom operators based on the recommendations of a revamped empowered group of ministers (eGoM).
Though the decision of the eGoM, to be headed by home minister P. Chidambaram, on pricing will go to the cabinet, its other recommendations are final and will not require cabinet approval.
The panel will decide on spectrum use charge, spectrum refarming, terms of payment, rollout obligations and spectrum mortgage issues, besides pricing.
So far, the eGoM has been unable to reach a consensus because of intense lobbying by telecom industry players and differing pricing figures suggested by the Telecom Regulatory Authority of India (Trai) and the telecom ministry.
While Trai had proposed a reserve price of Rs 18,000 crore for pan-India spectrum (5MHz per circle), a DoT panel had calculated the base price at over Rs 21,000 crore for the same amount of radiowaves.
Operators have been up in arms against these high prices and threatened to quit the bidding process.
Defence minister A.K. Antony, telecom minister Kapil Sibal, I&B minister Ambika Soni, law minister Salman Khurshid, minister of state in the Prime Minister’s Office V. Narayanasamy and Planning Commission deputy chairman Montek Singh Ahluwalia will continue to be the members of the eGoM.
Agriculture minister Sharad Pawar, who refused to head the eGoM after finance minister Pranab Mukherjee resigned, will not be part of the panel. Earlier, the eGoM had nine members, including Pawar and Mukherjee. Pawar had refused to head the panel, citing attempts to drag him into controversies.
Department of Telecom (DoT) officials said even if the panel met by next week, it will not be able to meet the Supreme Court deadline of holding auctions by August-end. The government has yet to fix a date for the next meeting, which was last convened on June 5.
An inter-ministerial panel comprising officials tasked with supervising the upcoming auction for 2G spectrum (or airwaves) has already said the government “would not be able to meet the Supreme Court deadline” and asked the DoT to seek an extension.
The inter-ministerial panel, in a July 2 note, has pointed out that “important decisions, including spectrum pricing issues, were still pending” and added that an auctioneer could be selected only after these matters were finalised.
The panel also pointed out that the DoT, in its clarificatory petition in the Supreme Court, had said it would need about 400 days to conduct the sale.
It added that the apex court deadline could not be met as the auctioneer (which is yet to be selected) would require adequate time to design and conduct the “complex process”.
Earlier this week, the DoT allowed new domestic and foreign players to bid for spectrum, which should spur competition and benefit users. New operators need to buy a unified licence for Rs 15 crore.
The unified licence makes them eligible to provide any service — mobile, landline, long-distance services and broadband. After getting the licence, the operators can join the spectrum auction.