- Idea Cellular gives undertaking to Supreme CourtBharti Airtel suggests new formula to calculate spectrum usage chargesSupreme Court thumbs up to spectrum auction, refuses relief to Vodafone India, Bharti Airtel, Loop MobileSupreme Court rejection of relief for telcos to fire up auctions starting today
Exactly two years after the Supreme Court had cancelled 122 licenses of 22 telecom operators, on Sunday another bench of the same court cleared the last hurdle for the government to hold spectrum auctions tomorrow.
At 9 am on Monday morning at the offices of each of the eight bidders as the connections with the auctioneer will light up on schedule, few officers will however have the time to reflect on the amazing coincidence as they pore over the price movements for each airwave on offer.
This means the government offer to sell 253.8 Mhz in the 1800 band and 46 in the 900 band can finally go through. Sources in the government expect the auctions to raise more than Rs 40,000 crore which will make the fiscal deficit for FY 14 attainable.
On February 2, 2012 the Supreme Court decision had created a meltdown in the Indian telecom sector that also pulverised the Indian economy. It sent Sensex companies like Bharti into eight quarters of plunging top line, wiped out about half a million jobs from the sector and put government into three international arbitration cases with foreign investors in the sector like Sistema from Russia and Telenor from Norway making mincemeat of India’s growing reputation as a prime investment destination.
From being India’s best growth story the telecom sector also created a huge discomfiture for the UPA government, as one minister A Raja went to jail with the then telecom secretary and another was hauled up by the CBI for questioning; questions reached the Prime Minister’s Office too.
Irrespective of how Monday’s auction pans out, this then is a turnaround story. In its assessment India Ratings & Research has consequently revised its outlook on the sector to stable from negative for FY15. “This is based on a gradual revival of investor confidence on the back of emerging clarity on regulatory issues towards end-2013,” it notes.