The Planning Commission has backed telecom regulator’s proposal to lower reserve price for spectrum auctions.
In a letter to the Telecom Commission, the planning body said that the Telecom Regulatory Authority of India’s proposals are based on robust assumptions and in line with international practice.
“In the absence of any alternative approach being thrown up in the consultative process leading to the TRAI recommendations, the basis may be accepted and the reserve price recommended for 1800 MHz and 900 MHz, and no auction for 800 MHz may be supported,” the Planning Commission said in the letter.
“The Planning Commission strongly supports and insists that TRAI recommendations on spectrum trading should be adopted and included in the auction design,” it added.
The letter has been approved by Montek Singh Ahluwalia, Deputy Chairman of Planning Commission.
Incidentally, the Commission’s Secretary is Sindhushree Khullar, wife of Rahul Khullar, Chairman, TRAI.
Telecom panel’s plea
The Planning Commission’s letter assumes significance because the Telecom Commission has asked the TRAI to explain the reduction in reserve price.
Earlier, a panel set up by the Department of Telecom rejected TRAI’s proposals on grounds that the recommended reserve price of spectrum did not reflect the true value.
However, the Planning Commission said there was a compelling need for a successful auction for which it is essential that the policy environment is conducive to the revival of confidence of the industry and also provide the much-needed revenues to Government.
As a package
“The TRAI recommendations on reserve price must be viewed as a package that includes spectrum trading, M&A guidelines and sharing of spectrum, a flat regime for spectrum charges and a level playing field to roll out obligations for all telecom service providers,” the Planning Commission said.
The Telecom Commission will take a final view after TRAI submits its review on the proposals.