First round of 3G bidding goes off smoothly

The first-ever auction in India of radio frequency spectrum for third generation (3G) telecommunication services got under way smoothly today. The first round of e-auction had already been completed by 1 pm, according to reports.

Nine telecom companies - Bharti Airtel, Reliance Communications, Vodafone Essar, Idea Cellular, Tata Teleservices, Aircel, Etisalat, S Tel and Videocon Telecommunications - are participating in the online auction, which will be held from 9 am to 7.30 pm on all days except Sundays and national holidays. It is believed that strong competition among bidders should push up winning bids to as much as thrice the base price.

Officials have said it would take at least a week or possibly more for the auctions to be completed.

The country's top mobile operators - most of them backed by international phone firms - are vying for a total 71 3G slots on offer in India's 22 telecoms zones in the auction, which is to be followed by a separate auction of broadband spectrum and would be one of the world's biggest such auctions in recent years.

The Indian government has pencilled in revenues of about 45,000 crore from the auctions, but analysts expect the auctions to fetch more than the government's target, helping it plug its fiscal deficit, which was at a 16-year high last year.

Bharti, India's biggest mobile operator, and rivals Reliance Communications, Vodafone Essar and Tata Teleservices are seen winning the most number of slots in the 3G auction, for which the base price has been set at Rs3,500 crore for a national licence.