Spectrum shortage is history, no plans of another auction: J.S. Deepak

Telecom secretary J.S. Deepak says govt is planning telecom reforms to make spectrum available for activities it is currently not available for


Telecom secretary J.S. Deepak. Photo: Pradeep Gaur/ Mint
Telecom secretary J.S. Deepak. Photo: Pradeep Gaur/ Mint

New Delhi: Spectrum shortage is history and the government has no immediate plans to conduct another round of auctions, telecom secretary J.S. Deepak said on Wednesday.

At an event on broadband development organized by the Telecom Regulatory Authority of India (Trai), Deepak said thanks to consolidation and structural changes, spectrum holding per operator will rise to 40MHz in 2017 from 18MHz earlier.

“Availability of spectrum, which used to be 18MHz per operator before the recently concluded October auction, has now become 25MHz per operator. And with consolidation and processes in the next one year, it will become at least 40MHz per operator. So, spectrum scarcity now in India is history and I don’t say so, the industry says this and they don’t need spectrum and are in no hurry to request another round of auction,” he said.

He said the government is planning reforms during this quarter to make spectrum available for activities it is currently not available for.

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In October 2016, Department of Telecom sold 965MHz of the 2,354.55MHz spectrum put up for auction, raising Rs65,789 crore in India’s largest spectrum sale. The government had put up spectrum worth Rs5.63 trillion at a base price for sale in five spectrum bands. The efficient 700MHz frequency was made available to telecom operators for the first time, but it went entirely unsold as it was priced at Rs11,475 crore per MHz.

Vodafone India emerged as the most aggressive bidder acquiring spectrum worth Rs20,280 crore thereby enhancing 4G capabilities in 17 circles. Bharti Airtel acquired 173.8MHz for Rs14,244 crore, Idea Cellular 349.20MHz for Rs12,798 crore, and new entrant Reliance Jio 269.2MHz for Rs13,672 crore.

To be sure, the government undertook a number of steps in April 2016 by harmonizing spectrum and making it more efficient. It helped operators bring their spectrum holdings together by removing guard bands and filters. The government also issued guidelines allowing sharing and trading of spectrum.

The government has also set a budget of Rs11,500 crore for telecom infrastructure development for the next fiscal year after having a drawl of Rs7,600 crore in 2016-17.

Deepak said that government aims to expand the infrastructure fund called the Universal Service Obligation (USO) which in last 15 years did not cross Rs3,000 crore.

“We aimed to raise this and I am glad to inform that this fiscal 16-17 our drawl will be a minimum of Rs7,600 crore and may be by the end of the year, if the government can fund, it will be Rs9,000 crore. So, the arguments that licence fees are collected but not spent on infrastructure will cease to hold water six months down the line. Our budget provision next year from the USO fund is Rs11,500 crore,” he said.

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