Trai, DoT pass the buck on lowering base price; auction likely to be put off till new govt comes to power at Centre.
In another example of bureaucracy flinching from taking decisions that may prove controversial in future, the Department of Telecommunications (DoT) and the Telecom Regulatory Authority of India (Trai) have been passing the buck on the reserve pricing of 800 Mhz band.
According to sources, the dilly-dallying in decision making may lead to auction for 800 Mhz itself getting delayed until the new government comes to power at the Centre.
So far, there have been more than half-a-dozen exchanges of letters between the Kapil Sibal-led DoT and Rahul Khullar-headed Trai, where both the organisations have tried to escape the responsibility of suggesting lower price for the 800 Mhz spectrum, which is used by CDMA players.
In its latest letter, the DoT has directed Trai under Section 25 of the Trai Act 1997 to suggest a reserve price.
The Section quoted by DoT gives government the power to issue directions to Trai which are binding to it.
Now, Trai has asked the government that why had it quoted the said section in its letter.
In September 2013, Trai had recommended that there should not be any auction of 800 Mhz spectrum.
It had also suggested that the government should explore if a part of 800 Mhz could be used for E-GSM services.
However, in November DoT in its letter to Trai asked for a fresh recommendation on 800 MHz spectrum in 15 days. To which the Trai had said it could not suggest the reserve price as the process required to be started afresh.
To make the matters worse, the government has failed to see a good response from the industry for its 800 Mhz spectrum.
In the last auction for 800 Mhz spectrum held in March 2013, only one player – Sistema Shyam Teleservices (SSTL) — participated and got the spectrum in eight circles at the base price of Rs 3,639 crore against the pan-India reserve price of Rs 9,100 crore.
But any decision to lower the price might prove to be fatal if any government agency questions the intention behind the lowering of the base price in future, sources said.
A government source said both parties want to delay the auction of the said spectrum until the new government comes to power.
The government has so far failed to garner the much touted Rs 40,000 crore from the sale of airwaves in the last two auctions.
The one which took place in November last year fetched the government Rs 9,407 crore, while the one in March this year only saw one bidder — SSTL.
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