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Spectrum bids won’t result in high call rates


New Delhi: Telecom Minister Ravi Shankar Prasad today ruled out an increase in the telecom call rates because of the record auction bid for spectrum services that received offers of Rs.1.09 lakh crore.

“I am seeing a huge campaign that mobile rates will go up. A person very familiar with telecom industry has given me analysis. The spectrum will be with operators for 20 years.

“As per the analysis, the yearly load on telecom operators is going to be about Rs 5,300 crore…and 1.3 paise per minute call,” he told a press conference.

Prasad was countering reports of  industry experts terming the auction-determined spectrum as very high that will lead to hike in mobile call and other services rates.

The spectrum was sold at about 68 per cent premium, for Rs 1,09,874.91 crore. At the base price fixed by the government, its value was Rs 65,463.40 crore.

About 11 per cent remained unsold which also included 800 Mhz, 1800 Mhz and 2100 Mhz (3G) bands.

“I believe when entire regime is conducted in fair and transparent manner, people do trust. I would like say one thing to my esteemed predecessor who talked about zero loss that if they would have done what I have done they would have got same result,” Prasad said.

Of the record Rs 1,09,874.91 crore received in the 19-day auction that concluded yesterday, the government will get Rs 28,872.7 crore within 10 days but Prasad wanted the telecom operators to pay the upfront money within six days to help the government meet its budget targets of the 2014-15 fiscal.

Ideal Cellular, which provides mobile services using GSM technology, bid a maximum of Rs 30,306.98 crore to buy spectrum in the 900 megahertz, 1800 MHz and 2,100 MHz bands. Airtel bid Rs 29,130.20 crore in the same bands, which also saw Vodafone commit Rs 29,959.74 crore.

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