Budget Puts 3G Auction Revenue at $7.2 Billion

by CXOtoday Staff    Jul 07, 2009

India expects to garner 350 billion rupees (7.2 billion)

from the upcoming auction of 3G radio spectrum - up 75% from the earlier target of 200 billion rupees.

The high price fetched by private telecoms selling their stakes has prompted a review of the floor price, causing a delay since this January. The government had initially aimed to get 200 billion rupees.

The finance ministry wanted the floor price doubled to 40.40 billion rupees, a figure that is yet to be cleared by a committee of ministers. The number of slots to be put on the block would also be reviewed, said a report.

"The price of 3G auction in metro cities and also in some of the A circles should be substantially higher than the reserve price," said Mahesh Uppal, director at telecoms consulting company ComFirst.

Availability of 3G spectrum allows telecom companies offer additional services such as high-speed Internet and video downloads on mobile phones.

The auction is likely to happen by December 2009.