Federation of Indian Chambers of Commerce and Industry (FICCI) has criticised the reserve price set by the cabinet for 2G auction saying it will result in high tariff. The industry body called it anti-consumer.

Ficci said it is disappointed to see that an unreasonably high base price has been fixed by the Cabinet for the auction of 2G spectrum.

The industry body has called upon the government to review its decision that has serious repercussion on the telecom sector that was once hailed as the poster boy of India's growth story.

"Ficci believes the move is anti-consumer and harms competition. It will force the telecom companies to increase tariffs and substantially increase entrance barriers for new entrants thus adversely impacting competition," the industry body said in a statement.

The Union cabinet on Friday had fixed the base price at Rs 14,000 crore for 5 MHz of airwaves and at Rs 18,200 crore in the 1,800 Mhz band. This is 22 per cent lower than Rs 18,000 crore minimum rate recommended by the sectoral regulator Trai.

Ficci also slammed the government for not lowering annual fee on spectrum usage charges.

"This will not only impact the overall health of the telecom industry, which is already reeling under severe financial stress, but also goes against the overall vision of the government to provide affordable telecom services to the masses," the Ficci statement said.

It said that the government has taken a decision that goes completely against the spirit of the National Telecom Policy 2012.

"Primary objective of NTP 2012 is the proliferation of 'affordable, reliable and secure telecom and broadband services in furthering the national development agenda while enhancing equity and inclusiveness', terming 'revenue maximisation as a secondary objective'," the statement said.

"The decision to set such abnormally high base price will further burden the already cash starved industry with increased debts", it added.