Govt panel seeks review of 5G spectrum base price

A high-level panel on National Infrastructure Pipeline has sought a review of the base price for 5G spectrum auctions, arguing that the reserve price for airwaves auction proposed by the department of telecom (DoT) is much higher than other countries and interest may be tepid.

“The high price comes at a time when the demand for spectrum is likely to be subdued as consolidation has reduced the number of players in the sector to effectively only four. However, providing inclusive and affordable 5G services to all sections of the population in the country is important to achieve the National Digital Communications Policy goals. For this, participation of the private players in the 5G auction should be robust. In order to enable this, the authorities should rationalise all elements of spectrum pricing for the auction, including base price, period of payment of charges and interest rates,” the task force comprising top officials said in its report submitted to finance minister Nirmala Sitharaman last week.

DoT has suggested a base price of Rs 492 crore per MHz and was hoping to mop up at least Rs 5.8 lakh crore. The committee included economic affairs secretary Atanu Chakraborty, who retired last week, NITI Aayog CEO Amitabh Kant and expenditure secretary T V Somanathan. It has prepared a pipeline for investments of around Rs 111 lakh crore over five years.

The task force has also called for a revamp of financing models for infrastructure and backed a return of development financial institutions, such as IDBI and IFCI, albeit with a sectoral focus. It has argued that banks and NBFCs are unable to meet the massive funding requirement and face several challenges, which is turning the clock back by close to two decades.

A key theme in the report is ensuring sanctity of contracts, something that power sector investors have complained about in the recent past, with the task force calling for a legislation to facilitating infrastructure.

―Times of India