Business
Government eyes Rs.28,872 crore by March 31 from telecom spectrum
New Delhi, March 26
Idea Cellular emerged as
the top bidder in the latest round of auctions for telecom spectrum with
a total commitment of Rs.30,306 crore, the government announced on
Thursday after the Supreme Court relaxed its earlier order restraining
finalisation of bids -- albeit with a caveat.
Communications
Minister Ravi Shankar Prasad, who revealed the finer details of the
auction process, said he was hoping for Rs.28,872 crore upfront -- out
of the total commitments worth Rs.109,874 crore -- to flow in by
end-March, with a gentle nudge to the seven successful companies.
The
victorious bidders will pay a quarter to a third of the winning price
within 10 days, and the rest in 10 annual installments beginning 2017.
The
Supreme Court bench of Justice Dipak Misra and Justice Prafulla C. Pant
paved the way for the announcement, but said the actual award of the
airwaves should await a further order on the matter, since it was still
in the process of hearing the petitions filed in this regard.
The
minister also sought to allay fears that the high cost of spectrum due
to the latest round will not impact on the tariff. He said detailed
analysis by the ministry suggested that telecom tariff could go up only
marginally by around Rs.0.013 per minute.
The details of the
winning bids were revealed after the Supreme Court, which is hearing a
host of petitions on the issue of spectrum, allowed the government on
Thursday to go ahead and finalise the bids and name the winners -- but
take a decision only after its order on that matter.
The Mukesh
Ambani-led Reliance Jio, which was expected to bid aggressively for the
spectrum to start 4G services in the country, made a total commitment of
Rs.10,077 crore.
Bharti Airtel committed the second-highest amount of Rs.29,310 crore behind Idea Cellular.
"Even
in terms of the quantum of spectrum sold, I'm happy to say, it was the
highest in 2015," Prasad said. He said that against 88.8 percent that
the latest tranche is expected to fetch, it was 43.04 percent in 2012,
17.78 percent in 2013 and 81.9 percent in 2014.
Among the other
players out of eight that qualified, Vodafone bid Rs.25,959 crore, Tata
Teleservices bid Rs.7,851 crore, and Reliance Communications bid
Rs.4,299 crore. Uninor, however, did not win any spectrum.
In the
Supreme Court, Justice Misra and Justice Pant in their order on the
matter said: "We are inclined to modify our order, and allow the Union
of India to finalise auction and proceed further."
All the
successful bidders shall be intimated that the auction will be finalised
subject to the outcome of the hearing of the matter by the court, the
order said, relaxing its earlier verdict of February 26 restraining the
government from finalising the bids.
Attorney General Mukul
Rohatgi said the auction was a tremendous success and made a plea to the
court to modify its earlier order so that the government can then ask
the successful bidders to make their respective initial payments
totalling Rs.28,872 crore, which has been factored into the budget.
The
numbers revealed by the communications minister suggest that the latest
tranche of auction -- spread over 19 days with 115 rounds of bidding --
has come as a windfall for the government, surpassing the previous high
of Rs.106,200 crore that the government received in the 2010 auction,
which was spread over 34 days with 183 rounds of bidding.
On
offer this time were blocks for 69 service areas at a total reserve
price of Rs.80,277 crore, and the provisional allocation was announced
for 63 of them at a winning price of Rs.109,874.91 crore. In 50 service
areas, the winning bids went at a premium.