Cabinet Committee – Decide on 3G Pricing

In wake of differences among various ministries regarding the pricing issue of third generation (3G) telecom services spectrum auction, the Department of Telecommunication (DoT) has left it to the Cabinet Committee on Economic Affairs (CCEA) to take a final call. DoT also suggested to go ahead with the current reserve price and if the expectations of the Government are not met, then th auction shall stand cancelled.

It is understood that the ministry of industry and information technology is not in favour of doubling the base prices for auction of 3G spectrum. Department of Industrial Policy and Promotion (DIPP) also share the view of its ministry.

The finance ministry had earlier suggested in a note addressed to the telecom secretary that base price for 3G spectrum for GSM operators should be doubled from Rs 2020 crore to Rs 4040 crore. The price for Wimax, the corresponding CDMA platform for advanced telecom services was also advised to be raised by 100%.

While DoT is not in favour of raising the price, the finance ministry feels that current base price may result in lower government revenue. As a result the issue is left now to be decided by the CCEA which may meet in next few days to take a call on the matter.

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