2G auction fizzles out with only Rs9,200 crore garnered

As was widely expected, the government has not even come close to meeting its target of garnering Rs40,000 crore from the Supreme Court-ordered resale of 2G spectrum. With the auction likely to end today itself, the government's revenue till now stands at a paltry Rs9,200 crore, according to the Department of Telecommunications.

The DoT said the reserve price of Rs14,000 crore has been exceeded in only two of the 22 circles: Uttar Pradesh East and Uttar Pradesh West. Gujarat also saw good demand. There was no application at all for pan-India spectrum.

The sixth round of bidding was under way at the time of writing. Till the end of the 5th round, 95 blocks had been bid for. In the sixth round, this went up to 98 blocks spread over 18 circles.

Thanks to the overoptimistically high reserve price, there were no takers for airwaves in category A circles like Delhi, Mumbai, Rajasthan and Karnataka, which account for 70 per cent of the current spectrum holdings.

Telenor has bid for eight circles. It lost nine licenses under the Supreme Court ruling in February that cancelled 122 licences awarded by former telecom minister A Raja. Telenor has not bid for the Mumbai circle.

The muted response to the 2G auction is in contrast to the sale of 3G airwaves that the government held in 2010, which lasted more than a month. India raised more than $12 billion (Rs65,600 crore) from that auction.