The Supreme Court today shot down the government's request to grant 400 days to complete fresh 2G auctions. The court has however extended the deadline for the 2G spectrum auctions till August 31.
Telecom Secretary R Chandrashekha told CNBC-TV18's Malvika Jain that they will do their best to to speed up the process and abide by the Supreme Court's directions.
Below is the edited transcript of the interview on CNBC-TV18 with Malvika Jain. Also watch the accompanying video.
Q: How do you plan to expedite the auction process now with the Supreme Court granting time till August 31?
A: We have not received the actual Supreme Court order. A lot depends on the details of what the action of the Supreme Court is. We have filed before the Supreme Court our 400-day schedule, listing all the steps and the time required for conduct of this auction. We are doing best to speed up the process and abide by the Supreme Court directions.
Q: What steps have you taken to expedite the auction process?
A: The first step is the receipt of the TRAI recommendation. We had indicated that we were expecting to receive TRAI recommendations by 3 April. However, we received it on 23 April. We had indicated that we would be able to study TRAI recommendations and form a response by 2 May. We have been working on all these issues in parallel to minimise the time.
Q: The response to TRAI’s recommendation has been negative and some companies have expressed their inability to participate in the auction due to high reserve price, how are you looking at the situation?
A: TRAI’s recommendations have to be seen holistically. There is an over emphasis on just one number. Just looking at that number is not a meaningful way at looking at the recommendations. You have to understand what this number means.
It’s not only the reserve price. You have to take into account that this is for liberalised spectrum which can be used for any technology in future over a period of 20 year.
That offers considerable flexibility, multiple uses, huge revenue opportunities over this period, especially as we enter the broadband era. There is a substantial reduction in the spectrum usage charge from 3-8% currently to 1%. Its impact over a 20 year period has to be taken into account. There is a moderation in the terms of payment, where only one third of the amount has to be paid up front and the balance payment after a two year monetorium over a further 10 year period.
When you look at all these factors together then the picture that emerges provides a more balanced view. As we examine the recommendations, we will keep all these aspects in mind and then look at these recommendations and firm up our initial views and give the feedback to the TRAI in order for them to be able to give us their final recommendation.
Q: Has the government set up an EGoM to expedite the process?
A: That’s correct. The orders were issued yesterday notifying the EGoM to take all the necessary decisions with regard to the auction of spectrum and the allocation of licenses.
Q: Who will constitute EGoM and what will be the agenda?
A: This EGoM is the same EGoM that exists today for the vacation of spectrum and the terms of reference of that EGoM have been extended to cover this issue. There have been some minor changes in the composition and its scope has been enlarged to include this responsibility.
Q: Will TRAI’s recommendations go to EGoM instead of Telecom Commission?
A: No, it will go through the Telecom Commission before going to EGoM.