Spectrum auction: Govt gets bids of Rs 39,300 crore on Day 1

Written by PTI | New Delhi | Updated: Feb 4 2014, 04:29am hrs
Spectrum auctionThe government today received bids worth Rs 39,300 crore on the first day of spectrum auction. Reuters
The government today received bids worth Rs 39,300 crore on the first day of spectrum auction with strong interest for 900 Mhz airwaves, which may help it curb the fiscal deficit.

"Bids worth over Rs 39,300 crore were received today. We are confident of exceeding the budget target," Telecom Secretary M F Farooqui told PTI.

The budget for 2013-14 has put revenue target of Rs 40,874 crore from spectrum sale in this fiscal.

The country's fiscal deficit at Rs 5.16 lakh crore has already crossed 95 per cent of budget target in the first nine months of 2013-14.

Bids for spectrum in 900 Mhz band were worth over Rs 16,000 crore and for that in 1800 Mhz band were about Rs 23,000 crore, a senior government official told PTI.

According to a DoT report, in 900 Mhz band, 16 blocks each have been put under the hammer in Delhi and Mumbai circles, while 14 blocks in Kolkata circle.

For more efficient 900 Mhz airwaves, which drew no takers in the previous auction, the Mumbai circle saw the maximum increase of 44 per cent to Rs 473.24 crore per Mhz against base price of Rs 328 crore per Mhz.

The price jumped by 38.52 per cent to Rs 172.16 crore per Mhz against base price of Rs 125 crore per Mhz for Kolkata, while Delhi saw an increase of 19.14 per cent to Rs 428.92 per Mhz from Rs 360 crore per Mhz.

For 1800 Mhz band spectrum, four circles Gujarat, Bihar, West Bengal and UP West -- saw excess demand.

Eight telecom firms, including Bharti Airtel, Vodafone and new entrant Reliance Jio Infocomm, are in the fray.

The DoT has put on the block about 385 MHz of radiowaves in the 1800 MHz band in 22 circles and 46 MHz in the 900 MHz band in three circles of Mumbai, Delhi and Kolkata.

The 900 Mhz spectrum put under the auction is currently held by Vodafone, Martel and Loop through their licences that are expiring in November. Also, the Supreme Court had directed government to put all airwaves freed from cancellation of 122 2G licences in February 2012.

The 2G spectrum in 1800 Mhz band was put for auction following a Supreme Court order of February 2013.

At the end of day one, there was excess demand for 900 Mhz spectrum band only in Mumbai, whereas there was no change in Delhi and demand seem stabilising in Kolkata.

The 2G spectrum base price saw marginal rise Bihar from Rs 7.40 crore to Rs 7.99 per block, Gujarat from Rs 28.60 crore to Rs 29.74 crore, UP (West) from Rs 12.40 to Rs 13.14 crore and West Bengal from Rs 4.20 to Rs 4.24 per block.

Seven rounds took place on day one, with each round of 60 minutes. There was a 20-minute break between rounds.

The auction started as planned after the Supreme Court on Sunday refused to interfere with the order of the telecom tribunal dismissing the pleas of Bharti Airtel, Vodafone, Loop and Idea for a stay on the spectrum auction and extension of their licences by another 10 years.

In March 2013, no GSM operators bid at the auction while only CDMA operator Sistema Shyam bought spectrum of about Rs 3,600 crore in eight of the 21 service areas. The entire auction lasted for just a day.

In November 2012, Rs 9,407 crore of bids were received for spectrum worth Rs 28,000 that was offered. The auction lasted for two days.

The 3G and BWA auction together fetched government over Rs 1.05 lakh crore in 2010. The 3G auction in 2010 lasted for 34 days while auction for broadband wireless access airwaves in 16 days.