Cabinet approves ministerial panel recommendations on spectrum pricing

The union cabinet at its meeting today approved the recommendations of the empowered group of ministers (EGoM) that no one-time charge be levied for spectrum holding up to 4.4 MHz for GSM operators.

The EGoM's recommendations on spectrum pricing comes in the backdrop of telecom service providers' objections to the high price the Telecom Regulatory Authority of India (TRAI) has recommended in its `Spectrum Management Licensing Framework'.

Accordingly, the EGoM has modified spectrum pricing, ie, charging of spectrum currently held by the incumbent telecom service providers (TSPs) as also charging in the event of spectrum sharing and intra service area mergers.

For all spectrum holdings beyond 4.4 MHz (GSM), a one-time charge will be levied prospectively upon the existing operators at 2012 auction determined price. The date of applicability of the charge will be the date of commencement of the first quarter following the date of the cabinet decision.

For spectrum held above 6.2 (GSM), a one-time charge would be levied from July 2008 onwards. There will be two prices.

The price pro-rated for the period between July 2008 and the date of applicability of auction determined price would be the 2001 entry fee divided by 6.2, duly indexed using the State Bank of India Prime Lending Rate (SBI PLR).