Taking the cue from the poor response to the telecom spectrum auction in the current year, the finance ministry, while finalising the Budget estimates, has kept a conservative assumption of R20,000 crore through the spectrum auction. This would imply that the government is not expecting rich revenue receipts through the spectrum sales from auction in the next fiscal.
For the fiscal year 2013-14, the government expects a revenue of R40,847.05 crore from other communication services, which include receipt from spectrum sale. This will also include around R5,000 crore that it may get from Sistema Shyam in the March 11 spectrum auction of 800 Mhz spectrum band. Since Sistema is the lone bidder and its earlier licence fee of R1,651 crore paid in 2008 would be adjusted by the government, roughly the company would be able to get spectrum by paying around R5,000 crore.
?Given the response seen for the spectrum auction in November, we calculated our Budget estimates based on realistic targets and actuals?, a senior government official said. ‘Receipts under ?Other Communication Services? mainly relate to one-time spectrum charges levied as per the recommendations of Trai (Telecom Regulatory Authority of India), auction of 1,800 MHz (megahertz) and 900 MHz spectrum and receipts from 800 MHz spectrum,’ the Budget document said.
In the last financial bill, the government had budgeted R58,217.3 crore under other communications services, of which the bulk was to come through spectrum auction while the balance from annual revenue share licence fee and spectrum usage charge.
Most of the telecom operators who won spectrum were given the option of deferred payment and some also had the option to adjust the entry fee they paid in 2008.
The department of telecommunications (DoT) had earlier targeted R40,000 crore through spectrum sales. The first round of auction was held in November and the government could sell only 55% of the provisioned spectrum. Moreover, there were no bidders in Delhi, Mumbai, Karnataka and Rajasthan where the base price was high.
The government could get total bids worth R9,407 crore only. However, a significant part of this was to be adjusted against the licence fee submitted in 2008 by two bidders Videocon and Telenor.
The government has also given bidders an option to make deferred payments ? operators would have to pay only 33% of the total amount upfront. The rest can be paid in 10 annual installments after a moratorium of two years ? the revenue would not accrue in the current year.