The Telecom Commission meeting on Saturday ended without arriving at any decision on the controversial reserve price for 2G spectrum auction. The commission which met on Thursday suggested 10 MHz of spectrum in each circle should be auctioned against Trai''s proposal for 5 MHz. 

But on Saturday it neither rejected nor accepted TRAI recommendations on the base price.

The Commission on Thursday could not take any decision on the controversial TRAI recommendations on reserve price for auction. The regulator had proposed Rs 18,000 crore for 5 Mhz chunk of spectrum, but a DoT committee further suggested an increase of 17 per cent. The inter ministerial panel deferred the decision for Saturday.

After so much of criticism by the telcos and industry bodies like COAI, AUSPI and GSMA the telecom Commission was expected to take a liberal and soft stance on the issue which could mean recommending a fresh reserve price or endorsing the recommendations of Trai for 2G spectrum auctions.

 But instead it put the onus onto the Telecom Authority of India (TRAI) asking the new Trai Chairman Rahul Khullar to study and analyse the reserve prices proposed and their impact.

“We will ask Trai to do an analysis. This will cover various scenarios: what will be the impact on tariffs if the cost escalation due to the new reserve price is fully passed on to consumers and when it is fully absorbed by telcos? What will be the cost impact for telcos if only new spectrum is auctioned at the new price and what will the impact be if spectrum already held by telcos is also converted to new, technology-neutral spectrum at the new prices? Also, Trai will have to do a circle-wise analysis,” Telecom Secretary R Chandrasekhar said

The commission has asked TRAI to complete the analysis by 31 May. Department of Telecom (DoT), which will then take its own recommendations and analysis to the Empowered Group of Ministers (EGoM) for a final decision.

According to Firstpost, at Saturday’s meeting, it was decided that auctions for the 1,800 Mhz and 800 Mhz bands would be done immediately and those for 900 Mhz would be done before June 2013. But no decision was taken on either the pricing or the timing for auction of 700 Mhz (4G) airwaves. On the 800 Mhz auction, the commission has favoured prices to be twice that of the 1,800 Mhz auction this was what Trai had recommended originally but then lowered it to 1.3 times the 1,800 Mhz price in its second set of recommendations.

The telecom secretary also said that the Telecom Commission had favoured levy of the higher 3 percent spectrum usage charge on telcos against the earlier Trai recommendation of dropping it to 1 percent. The commission is also against giving telcos the option of deferred payment of spectrum charges, saying past experience has not been healthy on such a matter.