Govt set to raise Rs 61,162 cr from spectrum auction: Sibal

The government has received bids worth over Rs 61,162 crore from "extremely successful" spectrum auction that ended today after 10 days, during which eight telecom companies slugged it out for radiowaves in 900 Mhz and 1800 Mhz bands, Communications Minister Kapil Sibal said.

It has ensured a minimum revenue of Rs 18,296.36 crore to the government in the current financial year ending March 31.

"I am very happy to report that auction is over. The total revenue that will come to government is Rs 61,162.22 crore. To that extent particular auction has been extremely successful," Sibal told reporters.

The government had put on the block about 385 MHz of radiowaves in the 1800 MHz band, and 46 MHz in the 900 MHz band. About 78 Mhz remained unsold in 1800 Mhz.

Telecom Secretary MF Farooqui said that bids worth Rs 37,572.60 crore have come in for radiowaves in 900 Mhz band, and Rs 23,589.62 crore for 1800 Mhz band.

Companies have the option to pay 33 per cent upfront for 1800 Mhz band, and 25 per cent in case of 900 Mhz band.

"Government will get at least Rs 18,296.36 crore from upfront payment this fiscal," Farooqui said.

The value of the total spectrum on sale was Rs 47,933.40 crore at reserve price.

The total bid value of the spectrum in the two bands, crossed over 90 per cent of the money that the government had received in the 3G spectrum auction in 2010, which fetched Rs 67,718.95 crore, although the quantum of radiowaves put up for sale in the latest round was higher.

On whether the strong bidding will impact mobile tariffs, Sibal said: "But this successful auction will really be successful if we are able to provide efficient service to consumers.

"Ultimate objective if any auction which has to provide service is that service must be provided efficiently and at a relatively affordable price. We hope the tariffs will remain reasonable in the years to come."

Eight companies participated in the auction-Bharti Airtel, Vodafone, Idea Cellular, Reliance Jio Infocomm, Aircel, Tata Teleservices, Telewings (Uninor) and Reliance Communications.

Assam circle saw over 5-fold rise in bid price for the 1800 Mhz band. The final bid price for a quantum of 11.40 Mhz in this band fetched Rs 411.54 crore, as against the reserve price of Rs 79.80 crore.

The circles where the entire spectrum in the 1800 Mhz band was sold included Andhra Pradesh, Assam, Delhi, Gujarat, Jammu and Kashmir, Madhya Pradesh, Maharashtra, Mumbai and West Bengal.

Delhi circle was one of the most sought-after with its price doubling for the 900 Mhz band to Rs 740.96 crore per megahertz, from a base price of Rs 360 crore. In the 1800 Mhz band, the price was up at Rs 364 crore/Mhz from a reserve price of Rs 219 crore.

The government conducted the third round of auction following a Supreme Court order in the 2G spectrum allocation case directing that all radiowaves freed from the cancellation of 122 licences in February 2012 should be auctioned.

Besides, the 900 Mhz has to be auctioned as some of the radiowaves in this band are held under old telecom licences, which will start expiring from November 2014.

Out of the five online spectrum auctions, the just-ended round was the largest in terms of radiowaves on sale, and third longest till date in terms of duration.

3G auction in 2010 lasted for 34 days, broadband wireless access (BWA) ended in 16 days. 2G auction in November 2012, on the other hand, ended in just two days, while the CDMA auction in March 2013 ended same day.