3G spectrum auction put off

In a surprise move, the government has postponed to the next fiscal auction of spectrum for 3G telephony which was expected to bring in Rs 35,000 crore to the exchequer.According to senior officials in the Department of Telecom, Law Minister Veerappa Moily, who is member of the EGoM, has opined that the auction should he held when the spectrum is available.

Telecom Minister A Raja could not be contacted immediately for his comments. Officials, however, said that the auction is expected to take place in August-September this year. It is pertinent to mention that the Ministry of Defence had agreed to vacate the spectrum only during middle of this year.

The Empowered Group of Ministers, headed by Finance Minister Pranab Mukherjee, had decided to allow four private telecom firms for the next generation mobile telephone services (3G) and had made a provision for garnering up to Rs 35,000 crore from the sale of airwaves in the current fiscal. The postponement of 3G spectrum auction to 2010-11 is likely to have some adverse impact on the government's finances and the fiscal deficit which is pegged at 6.8 per cent of the GDP.