Yashwant slams new spectrum reserve price set by TRAI

Nov 13 2013, 00:05 IST
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Loss to government can be as high as Loss to government can be as high as
SummaryA decision on this will be taken by the EGoM.

Expressing ‘dismay’ at the new reserve price of spectrum recommended by TRAI, senior BJP leader Yashwant Sinha has asked the Prime Minister to direct his office to reject the recommendation.

“I am appalled and dismayed at the proposed steep reduction in the spectrum reserve price and Spectrum Usage Charges (SUC) which will favour few operators at the cost of national exchequer,” Sinha said in a letter to Singh. This, according to him, pointed to the possibility of another scam in the telecom sector.

According to the Telecom Regulator Authority of India’s (TRAI) recommendations, the reserve price for 1 MHz of spectrum on pan-India basis in the 1800 MHz band has been reduced from Rs 2,376 crore to Rs 1,496 crore or by 37 per cent. For key circles like Mumbai and Delhi, the reduction is steeper at 50 per cent. “With these reserve prices and the amount of spectrum intended to be auctioned in the forthcoming auction, the potential loss to the government can be as high as Rs 35,000 crore,” Sinha added.

He pointed out that these recommendations of the TRAI contradicted its own arguments. Last year, the TRAI had justified the reserve price of Rs 3,622 crore for pan-India 1 MHz spectrum in the 1800 MHz band. “I fail to understand why the same body has now junked its own recommendations within one year and has recommended such a steep reduction in the reserve price,” he said, adding it was “not expected from a sector specialist regulator”. “I urge your office to take immediate remedial measures and in order to realise the true economic value of spectrum and to uphold the interest of Indian citizens and the revenue objectives of the government, the recommendations of TRAI with respect to reserve price should be rejected forthwith,” Sinha said.

The Telecom Commission has recommended a 15 per cent rise in reserve price for auction of airwaves in the 1800 mhz bands and 25 per cent increase in the prized 900 Mhz band. A decision on this will be taken by the EGoM. The increase suggested by the Commission came in the wake of the TRAI’s recommendations of a 60 per cent reduction in the base price for 900-MHz spectrum in the Delhi, Mumbai and Kolkata circles and a 37 per cent cut in the price of the 1,800-MHz spectrum. The TRAI’s recommendations of reduced prices was a follow up of muted response from telcos

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