Lok Sabha Question No. 1606 (UNSTARRED), answered on 2021-07-28
Subject: Reserve Price of Spectrum
Ministry: COMMUNICATIONS
Asked by: K. Shanmuga Sundaram

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF TELECOMMUNICATIONS

## LOK  SABHA UNSTARRED QUESTION NO. 1606 TO BE ANSWERED ON 28 th   JULY, 2021

## RESERVE PRICE OF SPECTRUM

## 1606.   SHRI SHANMUGA SUNDARAM K.:

Will the Minister of COMMUNICATIONS be pleased to state:

- (a) whether the Telecom Regulatory Authority of India (TRAI) has given any recommendation to Digital Communications Commission (DCC) regarding the reserve price of sale of 8300 MHz spectrum;
- (b) if  so,  the  details  thereof  including  the  reserve  price  recommended by the TRAI and the basis on which the said price has been calculated;
- (c) whether  the  Government  has  received  any  objection  from  Telecom  Service  Providers regarding the fixation of reserve price and if so, the details thereof; and
- (d) whether  the  apex  court  judgment  on  Adjusted  Gross  Revenue(AGR)  will  impact  the potential  bidders  and  defer  them  from  investing  in  telecom  infrastructure  and  if  so,  the  details thereof and the steps taken by the Government to ensure fair play in spectrum auctioning?

## ANSWER

## MINISTER OF STATE FOR COMMUNICATIONS (SHRI DEVUSINH CHAUHAN)

(a) Telecom  Regulatory  Authority  of  India  (TRAI)  gave  recommendations  dated  1.8.2018  on Auction of Spectrum in  700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz, 2500 MHz, 3300-3400 MHz, 3400-3600 MHz Bands, for a total of 8301.25 MHz of spectrum.

(b) The  Reserve  Prices  (RP)  recommended  by  the  TRAI  are  annexed.  TRAI  has  used  various methodologies  for  valuation  of  spectrum,  which  can  be  broadly  classified  as  variations  of  (i) Discounted Cash Flow (DCF), (ii) Cost Savings or avoidance, (iii) Multivariate Regression Analysis and  (iv)  Market  Comparisons.  The  Authority  has  used  average  of  various  alternative  valuations methods and benchmarked the average value with recent auction discovered price of the spectrum.

- (c) M/s Bharti Airtel had raised the issue of high reserve prices in case of 900 MHz band.

(d) The Hon'ble Supreme Court judgement on Adjusted Gross Revenue (AGR) has allowed TSPs to make payment in ten yearly instalments commencing from 01.04.2021. The spectrum auctions are conducted in  a  fair  and  transparent  manner  by  the  Government.  The  selection  of  auctioneer  is  also through  a  transparent  Request  for  Proposal  (RFP)  process.  Mandatory  Standardisation  Testing  and Quality Certification (STQC) for auction software is also taken prior to the auction.

## Reserve Prices (RP) recommended by the TRAI

| (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   | (In Crore of Rupees per MHz (Paired for 700/800/900/1800/2100 MHz and unpaired for 2300/2500 MHz/3300-3600 MHz bands))   |
|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------------------|
| LSA                                                                                                                      | 700 MHz band                                                                                                             | 800 MHz band                                                                                                             | 900 MHz band                                                                                                             | 1800 MHz band                                                                                                            | 2100 MHz band                                                                                                            | 2300 MHz band                                                                                                            | 2500 MHz band                                                                                                            | 3300-3600 MHz band                                                                                                       |
| Delhi                                                                                                                    | 915                                                                                                                      | 640                                                                                                                      | 585                                                                                                                      | 457                                                                                                                      | 635                                                                                                                      | 164                                                                                                                      | 164                                                                                                                      | 69                                                                                                                       |
| Mumbai                                                                                                                   | 1122                                                                                                                     | 727                                                                                                                      | 691                                                                                                                      | 561                                                                                                                      | 528                                                                                                                      | 167                                                                                                                      | 167                                                                                                                      | 84                                                                                                                       |
| Kolkata                                                                                                                  | 347                                                                                                                      | 160                                                                                                                      | 221                                                                                                                      | 173                                                                                                                      | 115                                                                                                                      | 38                                                                                                                       | 38                                                                                                                       | 26                                                                                                                       |
| Andhra Pradesh                                                                                                           | 557                                                                                                                      | 390                                                                                                                      | 417                                                                                                                      | 279                                                                                                                      | 185                                                                                                                      | 78                                                                                                                       | 78                                                                                                                       | 42                                                                                                                       |
| Gujarat                                                                                                                  | 546                                                                                                                      | 385                                                                                                                      | 373                                                                                                                      | 273                                                                                                                      | 181                                                                                                                      | 70                                                                                                                       | 45                                                                                                                       | 41                                                                                                                       |
| Karnataka                                                                                                                | 219                                                                                                                      | 192                                                                                                                      | 238                                                                                                                      | 109                                                                                                                      | 91                                                                                                                       | 112                                                                                                                      | 98                                                                                                                       | 16                                                                                                                       |
| Maharashtra                                                                                                              | 729                                                                                                                      | 510                                                                                                                      | 523                                                                                                                      | 365                                                                                                                      | 391                                                                                                                      | 72                                                                                                                       | 66                                                                                                                       | 55                                                                                                                       |
| Tamilnadu                                                                                                                | 199                                                                                                                      | 174                                                                                                                      | 235                                                                                                                      | 100                                                                                                                      | 394                                                                                                                      | 151                                                                                                                      | 132                                                                                                                      | 15                                                                                                                       |
| Haryana                                                                                                                  | 113                                                                                                                      | 57                                                                                                                       | 102                                                                                                                      | 57                                                                                                                       | 63                                                                                                                       | 8                                                                                                                        | NA                                                                                                                       | 8                                                                                                                        |
| Kerala                                                                                                                   | 190                                                                                                                      | 157                                                                                                                      | 199                                                                                                                      | 95                                                                                                                       | 203                                                                                                                      | 20                                                                                                                       | NA                                                                                                                       | 14                                                                                                                       |
| Madhya Pradesh                                                                                                           | 190                                                                                                                      | 143                                                                                                                      | 195                                                                                                                      | 95                                                                                                                       | 68                                                                                                                       | 9                                                                                                                        | NA                                                                                                                       | 14                                                                                                                       |
| Punjab                                                                                                                   | 177                                                                                                                      | 157                                                                                                                      | NA                                                                                                                       | 88                                                                                                                       | 104                                                                                                                      | 21                                                                                                                       | 24                                                                                                                       | 13                                                                                                                       |
| Rajasthan                                                                                                                | 211                                                                                                                      | 266                                                                                                                      | NA                                                                                                                       | 105                                                                                                                      | NA                                                                                                                       | 6                                                                                                                        | NA                                                                                                                       | 16                                                                                                                       |
| Uttar Pradesh (East)                                                                                                     | 305                                                                                                                      | 251                                                                                                                      | 262                                                                                                                      | 153                                                                                                                      | 126                                                                                                                      | 9                                                                                                                        | NA                                                                                                                       | 23                                                                                                                       |
| Uttar Pradesh (West)                                                                                                     | 230                                                                                                                      | 161                                                                                                                      | 211                                                                                                                      | 115                                                                                                                      | 76                                                                                                                       | 12                                                                                                                       | NA                                                                                                                       | 17                                                                                                                       |
| West Bengal                                                                                                              | 105                                                                                                                      | 74                                                                                                                       | 124                                                                                                                      | 53                                                                                                                       | 35                                                                                                                       | 6                                                                                                                        | NA                                                                                                                       | 8                                                                                                                        |
| Assam                                                                                                                    | 92                                                                                                                       | 64                                                                                                                       | 83                                                                                                                       | 46                                                                                                                       | 30                                                                                                                       | 2                                                                                                                        | NA                                                                                                                       | 7                                                                                                                        |
| Bihar                                                                                                                    | 175                                                                                                                      | 136                                                                                                                      | 201                                                                                                                      | 88                                                                                                                       | 99                                                                                                                       | 7                                                                                                                        | 7                                                                                                                        | 13                                                                                                                       |
| Himachal Pradesh                                                                                                         | 37                                                                                                                       | 24                                                                                                                       | 37                                                                                                                       | 18                                                                                                                       | 12                                                                                                                       | 1                                                                                                                        | 1                                                                                                                        | 3                                                                                                                        |
| Jammu &Kashmir                                                                                                           | 34                                                                                                                       | 15                                                                                                                       | NA                                                                                                                       | 17                                                                                                                       | 13                                                                                                                       | 1                                                                                                                        | 1                                                                                                                        | 2                                                                                                                        |
| North East                                                                                                               | 34                                                                                                                       | 15                                                                                                                       | 23                                                                                                                       | 17                                                                                                                       | 6                                                                                                                        | 1                                                                                                                        | NA                                                                                                                       | 2                                                                                                                        |
| Orissa                                                                                                                   | 54                                                                                                                       | 47                                                                                                                       | 86                                                                                                                       | 27                                                                                                                       | 44                                                                                                                       | 5                                                                                                                        | NA                                                                                                                       | 4                                                                                                                        |

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