The Union Cabinet on Wednesday approved the next spectrum auction of a total of 2251.25 MHz. Addressing the media, post the Cabinet meeting, Union Minister for Communications Ravi Shankar Prasad said that the auction will be held for spectrum in the 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz and 2500 MHz frequency bands, for validity period of 20 years.
A total of 2251.25 MHz will be offered with total valuation of over Rs 3.92 lakh crore. In the auction, bidders will have to comply with parameters such as block size in which bidders will be able to submit their bids, spectrum cap -- the maximum amount of spectrum that can be held by each bidder after the completion of the auction, rollout obligations, payment terms among others.
“By winning right to use spectrum through the auction, incumbent telecom service providers will be able to augment their network capacity whereas new players will be able to start their services,” the Union government said in a statement.
Successful bidders may pay entire bid amount in one go or may exercise an option to pay a certain amount (25 per cent for spectrum won in 700 MHz, 800 MHz, 900 MHz bands or 50 per cent for spectrum won in 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz bands) upfront and remaining amount in a maximum up to 16 equated annual instalments, after a moratorium of two years, said an official statement.
In addition to the bid amount, successful bidders will also have to pay 3 per cent of the Adjusted Gross Revenue (AGR) excluding wireline services as spectrum usage charges for the spectrum won through this auction.
“It is relevant that the Telecom Sector today is a key infrastructure provider with strong linkages with economic growth, direct and indirect employment generation and expansion of Digital India,” the statement added.