Inter-ministerial panel clears draft RFP to select auctioneer for 2019 spectrum sale

An inter-ministerial panel has approved the draft RFP (tender document) to select the auctioneer who will conduct the upcoming spectrum sale, including for 5G radiowaves, according to a source.

The Department of Telecom hopes to have the auctioneer in place by early-September, the source added.

The matter is likely to be taken up in the next meeting of Digital Communications Commission (DCC) scheduled this month.

Once the DCC takes a view on the issue, the Request for Proposal (RFP) will be floated, the source told PTI.

The inter-ministerial committee, apart from officials from the Telecom Department, has representation from the Department of Economic Affairs, Ministry of Electronics and IT, and Niti Aayog, among others.

The panel has cleared the draft RFP for selection of the auctioneer to conduct the spectrum auction, the source noted.

The last spectrum auction in October 2016 saw only 40 per cent of the spectrum offered being sold.

In that auction, the government had garnered Rs 65,789 crore from sale of just 965 MHz, out of the entire 2,354.44 MHz that was on offer at the base price of Rs 5.63 lakh crore. Among the bandwidth which went unsold was the valuable 700 Mhz which the telcom companies gave a miss, citing high base price.

The government, which did not auction any spectrum in 2017-18 and 2018-19, wants to hold the nation's biggest auction of over 8,000 MHz of airwaves this year.

However, the price of the radiowaves continues to be a hurdle.

Regulator Trai had recently reiterated its recommendation on base price and valuation of spectrum, making it clear to the Telecom Department that it has considered "all relevant factors" while giving views on prices.

Last month, amid an industry discontent over the pricing of spectrum, DCC had decided to approach the Telecom Regulatory Authority of India (Trai) to reconsider its spectrum recommendations to ensure competition and greater participation of players in the upcoming auction.

In a detailed response to the Telecom Department, Trai last week said it had considered all the relevant factors, including the methodology, assumptions, developments between the spectrum auction in 2016 and its suggestions of August 1, 2018, and the rationale for spectrum valuation and reserve price while giving its recommendations.

Trai had also argued that for sale of spectrum in an auction, the bidders consider various factors like company's vision, network needs, price, and number of competing participants, among others, and so no guarantee can be given about sale of all the spectrum put to auction.

Trai further asserted that the government's own marketing efforts will also have an impact on participation in auction.