2G auction begins on 23 January; DoT launches process
13 Dec 2013
The Department of Telecommunications has issued the main document for the auction of 2G airwaves – the Notice Inviting Application (NIA) – and the auction will start on 23 January.
"The award of Spectrum in 1800MHz and 900MHz band shall be conducted as a single process. A common Notice has been issued only for the sake of convenience," The NIA issued late Thursday night said.
The last date for bidders to put in their application is 4 January. A mock auction will be held on January 21-22.
The DoT will hold a pre-bid conference on 20 December and the last date for companies to seek clarifications on rules stated in the NIA is 28 December.
Under the initial proposal, DoT had sought 60 days' time to start auction from the date the cabinet decided on the spectrum base price and the NIA was to be issued after 15 days of the decision.
The DoT has, however, issued the NIA within three days of the cabinet approving the minimum price for two sets of 2G spectrum - 1800 Mhz band and 900 Mhz.
Together, the 900 MHz and 1800 MHz band airwaves are valued at about Rs48,685 crore.
The government has provisioned garnering Rs 40,874.5 crore from spectrum revenue in the budget. This includes upfront money from the auction and various fees levied on airwaves used for commercial mobile communications.
The successful bidders will have the option to pay the final price of spectrum in instalments. A successful bidder in the 1800 Mhz band will have the option to pay 33 per cent upfront, while for airwaves in 900 Mhz band upfront payment is 25 per cent.
There shall be a moratorium of two years for payment of the balance amount of one-time charges for the spectrum, which shall be recovered in 10 equal annual instalments.
In case all spectrum gets sold and companies opt to make deferred payments, the government will be able to get about Rs15,200 crore this fiscal from direct sale of airwaves.
New companies will have to bid for minimum of 25 blocks of airwaves, each of 200 KHz frequencies, amounting to 5Mhz in 1800 Mhz band. Existing players will be required to bid a minimum of three blocks of airwaves in this band.
On spectrum sharing, the NIA said companies who buy spectrum through the auction will be able to share airwaves for providing mobile phone services.
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