Spectrum auction will be successful: TRAI

Asserting that the proposed auction of airwaves will be successful, telecom regulator TRAI said its recommendation of Rs. 18,000 for pan-India spectrum did not "cause a grief to the industry".

"The telecom industry has not come back to me on the issue of TRAI's decision to fix reserve price at Rs. 18,000 for spectrum once it was put on in the public domain," he told.

Terming TRAI's recommendations on spectrum auction as "arbitrary, regressive and inconsistent", telecom operators had said the proposals would hurt further investment in the sector and expansion of services in rural areas. Many operators had expressed apprehensions that tariff would go up steeply if TRAI recommendations were accepted.

Khullar, however, said, "The price of spectrum has not caused a grief to the telecom industry. The industry met him over host of other (non-spectrum) issues." On the proposed auction, he sounded confident that it would be successful.

"I don't want to take names of any individuals and companies. They have came and told me they really believe in auction and I don't know why for some reason the media is building a square that the auction will not take place. The auction will take place. There will be bidders and I am sure it will be successful," he said.

The Supreme Court had fixed a deadline of August 31 for the spectrum auction.

The Telecom Regulator Authority of India (TRAI) had in April recommended steep high base price of Rs. 18,000 crore for pan-India spectrum in 1800 MHz band in the proposed auction, which set off fears of a hike in mobile phone tariffs. This is 10 times more than the 2008 price paid by companies for the radiowaves.

TRAI's suggestion was pursuant to the Supreme Court in February ordering auction of 2G spectrum after cancelling the 122 mobile licences issued by the then Telecom Minister A Raja in 2008.

Later in August 2012, the government fixed a floor or minimum price of Rs. 14,000 crore for pan-India spectrum. This is was 22 percent lower than Rs. 18,000 crore minimum rate suggested by sector regulator, TRAI.

It was, however, 7 times higher than the price new companies had paid in 2008 to get spectrum from the then Telecom Minister A Raja.