No word yet on spectrum harmonisation

The Centre is likely to miss the March 31 deadline for spectrum harmonisation, with the Defence Ministry yet to release the airwaves for commercial usage.

A government official told BusinessLine that the delay in harmonisation means a delay in spectrum auctions – TRAI has already given reserve prices of each band – which may result in government getting lesser revenue from the sector.

Purpose of harmonisation Spectrum harmonisation refers to uniform allocation of radio frequency bands across regions, especially in border areas, where the Defence holds the radio waves. Harmonisation leads to usage of bands into contiguous blocks, leading to efficient utilisation of spectrum.

According to industry experts, the harmonisation process is already getting delayed after not meeting the deadline of December 31, which could have facilitated additional 3G airwaves for commercial use.

“It may take some more time for harmonisation to happen as there is no green signal from the Defence Ministry as yet,” said a government official privy to the matter, adding that the process may take another few months.

Cabinet decision The Cabinet in January last year had approved setting up a ‘Defence Band’, by which it was making available the remaining airwaves (apart from using spectrum into its own use) for commercial use in areas like telecom and broadcasting.

The Cabinet had also approved swapping of 15MHz of 3G spectrum between the Defence and Telecom ministries. However, the required spectrum bands still need to be harmonised before being made available for commercial use, and without which the upcoming auctions are not possible.

“One of the most important things for a mega auction is that there should be enough spectrums made available to the industry to bid for. This is the law of demand and supply. There are significant air bands available with the Defence, which is critical for the industry,” said Hemant Joshi, Partner, Deloitte Haskins & Sells LLP. According to the Budget proposal, the Centre expects to double the revenue from communication services to ₹98,994.93 crore in the next financial year.

The said amount is almost double the revised estimates for the current fiscal at ₹56,034.35 crore. The DoT had conducted auction of spectrum in March last year simultaneously in 2,100 MHz, 1,800 MHz, 900 MHz and 800 MHz bands, valued at ₹1,09,874.91 crore to the exchequer.

TRAI-recommended prices This year, prices have been designed to fetch about ₹5 lakh crore to the exchequer, as per the TRAI’s recommended reserve prices. TRAI in January had fixed the reserve prices of all major bands, including 700 MHz, 800MHz, 900MHz, 1,800MHz, 2,100MHz, 2,300MHz and 2,500MHz. It had fixed the premium band of 700MHz at ₹11,485 crore per megahertz, pan-India.

The DoT is expected to consider the prices and pave the way for the auctions shortly. But it needs harmonisation of the Defence bands too, post which it would go to the Telecom Commission and then the Cabinet.

JS Deepak, Secretary of DoT, recently said the Department was working on TRAI’s recommendations, and is expected to formulate its views by end of this month so that auctions can happen in June/July.

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