New Delhi: An empowered group of ministers (EGoM) led by home minister P Chidambaram meets today to discuss the base price for an upcoming auction of second-generation (2G) radio airwaves. The panel decided on the network rollout obligations for the winners in the auction at its Wednesday meeting. (Also read: The Indian Telecom saga: Dream turned sour)
Here are reasons why this meeting is crucial:
* Any decision to charge a one-time fee would hit those mobile phone carriers, including Bharti Airtel, Vodafone's local unit and Reliance Communications, that are not affected by a Supreme Court order to revoke permits granted in a scandal-tainted 2008 sale and are not required to bid in the auction.
* Eight carriers which are set to lose some or all of their permits after the court order must bid in the auction to win those back. The telecoms ministry has proposed asking all mobile phone operators to pay for their existing airwaves based on the auction-determined price for the remaining validity of their telecoms permits, in what government officials say is aimed at creating a level playing field.
* India will sell 2G airwaves for the first time through an auction following a Supreme Court order to revoke all permits awarded to carriers in a scandal-tainted 2008 state grant process. The court had asked the government to conduct the auction by end-August, a deadline the telecoms ministry is widely expected to miss as the price and other rules are yet to be set.
* The panel of ministers, which also has the final say on the auction rules, is yet to decide the base bidding price. The telecoms regulator had suggested an auction starting price that is nearly 10 times higher than what carriers paid in the 2008 sale, drawing howls of protests from the industry.
* The panel's decision on the one-time fee will, however, have to be passed back to the cabinet for final approval.
* Shares in telecom operator Bharti Airtel gained 2.7 per cent over the past one week on expectations for a favourable decision as a panel of ministers is scheduled to meet on Wednesday to decide on which prices to charge for 2G radio airwaves at an upcoming auction. The ministerial panel has the final say on most auction rules, but the base price needs to be approved by the cabinet.
(with inputs from agencies)
Here are reasons why this meeting is crucial:
* Any decision to charge a one-time fee would hit those mobile phone carriers, including Bharti Airtel, Vodafone's local unit and Reliance Communications, that are not affected by a Supreme Court order to revoke permits granted in a scandal-tainted 2008 sale and are not required to bid in the auction.
* Eight carriers which are set to lose some or all of their permits after the court order must bid in the auction to win those back. The telecoms ministry has proposed asking all mobile phone operators to pay for their existing airwaves based on the auction-determined price for the remaining validity of their telecoms permits, in what government officials say is aimed at creating a level playing field.
* India will sell 2G airwaves for the first time through an auction following a Supreme Court order to revoke all permits awarded to carriers in a scandal-tainted 2008 state grant process. The court had asked the government to conduct the auction by end-August, a deadline the telecoms ministry is widely expected to miss as the price and other rules are yet to be set.
* The panel of ministers, which also has the final say on the auction rules, is yet to decide the base bidding price. The telecoms regulator had suggested an auction starting price that is nearly 10 times higher than what carriers paid in the 2008 sale, drawing howls of protests from the industry.
* The panel's decision on the one-time fee will, however, have to be passed back to the cabinet for final approval.
* Shares in telecom operator Bharti Airtel gained 2.7 per cent over the past one week on expectations for a favourable decision as a panel of ministers is scheduled to meet on Wednesday to decide on which prices to charge for 2G radio airwaves at an upcoming auction. The ministerial panel has the final say on most auction rules, but the base price needs to be approved by the cabinet.
(with inputs from agencies)
