Airwaves in the 700 MHz band are the most expensive
Airwaves in the 700 MHz band are the most expensive

Govt seeks Trai’s view on Railway demand for spectrum

  • The ministry has approached the department of telecommunications, seeking 10MHz of the efficient and expensive 700MHz airwaves
  • Railways has requested an ‘administrative allocation’ of the spectrum, outside the auction route

The government will seek the telecom regulator’s views on the railway ministry’s request for a portion of the 700 megahertz wireless spectrum to roll out an advanced signalling system, telecom secretary Aruna Sundararajan said.

The ministry has approached the department of telecommunications, seeking 10MHz of the efficient and expensive 700MHz airwaves earmarked for high-speed 4G mobile services, to deploy a signalling system to boost safety and security. It has requested an ‘administrative allocation’ of the spectrum, outside the auction route.

“This (demand) will be referred to Trai (Telecom Regulatory Authority of India). First, since this is a question of spectrum; so, we need to get Trai’s views. Second, 700 MHz has been earmarked for mobile services auction in India. Third, the administrative allocation is something that the department has not done for access spectrum so far," Sundararajan told reporters.

Access spectrum—the kind railways needs—is used for mobile network coverage, while backhaul spectrum is used to boost capacity.

Airwaves in the 700 MHz band are the most expensive, as they are considered very efficient for deploying 4G LTE networks and have greater structural penetration. LTE device ecosystem is developing fast in this band.

At the reserve price of 6,568 crore per MHz suggested by Trai in August, Railways’ demand for 10 MHz in this band will be worth at least 65,680 crore. Giving this to railways without an auction could also mean a corresponding revenue loss for the exchequer.

Interestingly, there were no takers for the same premium band in the last spectrum auctions held in October 2016, as telecom operators found it too expensive.

That left a total of 770MHz (35 MHz spectrum in 22 telecom circles) unsold, and there has been no auction since. Given the failure to sell this band, Trai in August proposed fixing its base price at 6,568 crore per MHz—43% less than 11,485 crore set in the previous auction.

As per a Supreme Court ruling in 2012, for commercial purposes, natural resources such as spectrum should be distributed only through auctions.

In its past recommendations, the regulator has been clear that spectrum is the most critical resource for rollout of wireless networks and services and it was necessary that the available spectrum is utilized fully, and transparently assigned in such a way that results in maximization of socio-economic gains. As part of its recommendations to the government on national digital communications policy, Trai had in February last year urged DoT that in order to create awareness about the value of spectrum assigned to various government entities, nominal values should be assigned for such spectrum holdings.

“To encourage government departments for freeing underutilized/substitutable spectrum, they should be incentivized and spare spectrum should be assigned for more productive use through auction process. Further, audit and accounting of the spectrum in use by various governments and private entities is also essential to ensure optimum usage of spectrum," Trai had then suggested.

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