3G gets Centre Rs 67,718 crore

After 34 days of suspense, the auction for 3G spectrum is finally over with the government richer by Rs 67,718.95 crores from the proceeds of the sale. This is almost twice what the government had originally hoped to raise.

The extra amount will help reduce India’s fiscal deficit to 4.9 per cent from the 5.5 per cent that was projected earlier. The finance minister, Mr Pranab Mukherjee, said the extra money will give him more elbow room.

3G spectrum or radio waves would allow telecom firms to offer high-speed Internet and other premium services such as making video calls.

The cost of a pan-India 3G licence is Rs 16,751 crores but no single company managed to bag a licence in every circle. Bharti, Reliance Communications and Vodafone have bagged the bulk of 3G licences; they were successful in bagging the three available slots in the prime circles of Delhi and Mumbai. Idea, Tata and Aircel have also been successful in bagging many of the major circles. Bharti will pay out the highest amount for its spectrum purchases — Rs 12,295 crores.

Delhi and Mumbai were the highest value circles and went for a price of Rs 3,317 crores and Rs 3,247 crores respectively. Five other circles — Maharashtra, Gujarat, Andhra Pradesh, Karnataka and Tamil Nadu — were sold for more than Rs 1,000 crores.

Etisalat and Videocon, both new operators, failed to get any 3G spectrum at all while Aircel and S Tel bagged a few service areas.

In 2008, the telecom ministry had awarded all-India 2G spectrum to some players for Rs 1,651 crore, which has since flared into a major issue.