The 5G spectrum auction in India kicked off with a bang as private telecom operators placed bids worth over Rs 11,000 crore on the first day. The auction, which saw five rounds of bidding, is set to resume on June 26, as per the Department of Telecommunications website.
The Indian government is offering airwaves amounting to Rs 96,317.65 crore, attracting major players like Reliance Jio, Bharti Airtel, and Vodafone Idea. These companies are vying for the sub-GHz band, 900 MHz, and select mid-bands like 1800 MHz and 2100 MHz to strengthen their 5G holdings.
On the initial day of the auction, telecom companies showed interest in various bands including 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2500 MHz, 3300 Mhz, and 26 GHz. Telcos made significant purchases, acquiring 60.4 MHz spectrum in the 900 MHz band for Rs 7,004 crore, 50.6 MHz spectrum in the 1800 MHz band for Rs 3,614 crore, and 20 MHz in the 2100 MHz band for Rs 546 crore.
Telecom expert Parag Kar analyzed the day 1 report and highlighted that the spectrum acquired in this auction will be valid for 20 years. Telcos have the option to share, trade, lease, and surrender the spectrum after 10 years, providing flexibility in their operations.
In terms of payment, telcos might choose to pay the full amount upfront to avoid interest costs. The auction’s deferred payment interest rate is set at 8.65 percent, higher than the previous year’s rate of 7.2 percent. Payment options include part payments with corresponding moratoriums or 20 yearly instalments, with the first instalment due 10 days post-auction. Pre-payment without penalty is also allowed.
Looking back at the 2022 spectrum auction, the government accumulated a record Rs 1.5 lakh crore. This year, Reliance Jio, Bharti Airtel Ltd, and Vodafone Idea submitted earnest money deposits, with Bharti Airtel expected to be the highest spender with an outlay of Rs 10,400 crore.
The ongoing 5G spectrum auction has been hailed by COAI, the representative body for private telecom companies, as a significant driver for the swift deployment of 5G services across the country. The auction is anticipated to lead to improved coverage and connectivity, marking a substantial step towards achieving digital inclusion.
