2G spectrum auction: Bids rise to Rs 52,700 crore on fourth day

Telecom companies jointly made bids of about Rs 52,700 crore at the end of the fourth day of the ongoing spectrum auction, driven by high demand for premium 900 MHz airwaves in the metros of Delhi, Mumbai and Kolkata.

"We are in the process of completely transforming the sector and giving back to it the confidence that it had prior to its decline in 2010...the auction is doing well from the revenue standpoint," Telecom Minister Kapil Sibal said after Thursday's rounds closed.

Telecom Secretary M F Farooqui said the total value of the bids was Rs 52,689 crore, of which Rs 30,754 crore came for 2G spectrum in the 1800 MHz band, and Rs 21,935 crore for the premium 900 MHz band.

The minister attributed the demand to various factors, mainly the new licencing regime that allows telecom companies to provide services using any technology and rationalisation of reserve prices and spectrum usage charges, besides providing enough bandwidth for all players to compete.

At the end of Day 4, for the first time there was no excess demand for the 900 MHz band in any of the metros.

Bids for the 900 Mhz band in Delhi came in at Rs 639.24 crore per megahertz, 78 per cent higher than the base price of Rs 360 crore fixed by government.

In Mumbai, bids at Rs 563.09 crore per MHz were 72 per cent higher than the reserve price and in Kolkata they were 54 per cent higher at Rs 192.71 crore.

There was excess demand for 1800 MHz band spectrum in Assam, Jammu and Kashmir, Madhya Pradesh, UP East and UP West service areas, because of which the auction will resume on Friday.

Demand for airwaves in the 1800 MHz band in Delhi increased as well, leading to a 5 per cent rise in the base price to Rs 230 crore per MHz.

The government is offering about 385 MHz of spectrum in the auction, which started on February 3, in the 1800 Mhz band following a Supreme Court order of February 2013.

The auction resumed on Thursday morning after bids totalling about Rs 50,000 crore had been submitted at the end of 21 rounds on the third day.

Bids worth Rs 29,000 crore were received on Wednesday for 2G spectrum in the 1800 Mhz band and over Rs 20,500 crore for 900 MHz airwaves.

Airwaves in the 900 MHz band in Delhi, Mumbai and Kolkata are currently held by Vodafone, Airtel and Loop Mobile, whose licences expire in November.