EGoM to meet on June 5 for fixing spectrum base price

An Empowered Group of Ministers (EGoM), headed by Finance Minister Pranab Mukherjee, will meet on June 5 to decide on the base price for the much-awaited auction of telecom spectrum. "The EGoM will meet on June 5," Department of Telecom Secretary R Chandrashekhar told reporters here.

The Telecom Commission (TC), which met here last week,left the decision on the high-powered ministerial panel of fixing the price of spectrum to be auctioned, as necessitated by the cancellation of 122 2G licences by the Supreme Court.

It has asked sectoral regulator Trai to conduct an analysis of the impact of spectrum price on tariff if it is passed on and in case it is absorbed, then what is the effect on companies' businesses, viability and return on investment.

The detailed analysis, along with Trai recommendations, would be presented to the EGoM for its decision. Trai has proposed Rs 3,622.18 crore for one megahertz (MHz) as base or minimum price for pan-India spectrum for auction.

This suggested price is around 10 times higher than the floor price at which the former Telecom Minister A Raja had allocated spectrum and licences in 2008.

The apex court had cancelled the licences in the 2G spectrum case, following which Trai was asked to recommend auction modalities for the cancelled permits in the 800 MHz (CDMA services) and 900 MHz (GSM services) bands.