Government panel seeks 5G spectrum base price review

NEW DELHI: A high-level panel on the National Infrastructure Pipeline has sought a revision of the base price for 5G auctions, arguing that the reserve price for airwaves proposed by the telecommunications department (DoT) is much higher than other countries and the interest may be lukewarm.

“The high price comes at a time when the demand for spectrum is likely to drop, as consolidation has reduced the number of players in the sector to just four. However, providing inclusive and affordable 5G services to all sectors of the country's population is important to achieve the objectives of the National Digital Communications Policy. For this, the participation of private players in the 5G auction must be solid. To allow this, the authorities should rationalize all the elements of the spectrum price for the auction, including the base price, the period of payment of the charges and the interest rates ”, said the force that includes high officials in its report presented to the finance minister last week.

DoT suggested a base price of Rs 492 million rupees per MHz and hoped to eliminate at least Rs 5.8 crore. The committee included the secretary of economic affairs, who retired last week, the CEO of Aayog and the secretary of expenses T V Somanathan. He has prepared an investment pipeline of around Rs 111 lakh crore for five years.

The working group also called for a renewal of infrastructure financing models and supported the return of development finance institutions, such as IDBI and IFCI, albeit with a sectoral focus. It has been argued that banks and NBFCs cannot meet the massive financing requirement and face various challenges, which is ticking the clock by almost two decades.

A key issue in the report is ensuring the sanctity of contracts, something investors in the power sector have complained about in the recent past, and the task force is calling for legislation to facilitate infrastructure.