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Reserve price of spectrum major concern: COAI

Reserve price of spectrum major concern: COAI

By Indo-Asian News Service | Updated: 30 June 2012 22:21 IST

The telecom industry hopes that the Empowered Group of Ministers (EGoM) which meets Monday is able to take a decision on at least the reserve price of spectrum, industry panel for GSM operators COAI said Saturday.

"Our principle concern is reserve price, the other issues including refarming (of spectrum) can be taken care of at a later stage," Rajan Mathews, director general, Cellular Operators Association of India (COAI) told IANS.

The EGoM which is to be headed by union Agriculture Minister Sharad Pawar after former finance minister Pranab Mukherjee resigned to contest the presidential poll is expected to discuss controversial issues like the reserve price, mortgaging of spectrum and deferred payment.

Earlier, the meeting was to take place June 21 with Mukherjee slated to head it.

TRAI had recommended a reserve price of Rs.3,622 crore for 1 Mhz pan-India spectrum, which is around 10 times higher than the price at which 2G licences were allocated in 2008 under then Telecom Minister A. Raja.

Re-farming refers to redistribution of airwaves in the 900-MHz band largely held by incumbents and substituting it with frequencies in the 1,800-MHz band.

According to analysts, the delay in decision-making would create further uncertainties for the sector. Questions are already being asked whether the government would be able to meet the Supreme Court's deadline of Aug 31 to complete the auction.

Meanwhile, the telecom operators have warned of a 100 percent hike in tariffs if TRAI's proposals are accepted.

According to consultants PricewaterhouseCoopers (PwC), telecom tariffs are expected to rise by 90 paise a minute in metros and 20-34 paise on an average across the country if the sector regulator's recommendations on spectrum pricing are accepted.

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