The proposed auction of BSNL’s spectrum for broadband
wireless access (BWA) licence will pave way for the official spectrum trading
in Indian telecom market.

According to telecom ministry officials, the returning
of spectrum to the government and auction of the same will come under the
purview of spectrum trading. We may achieve the best market price during the
auction,” said a top BSNL official, who does not want to be named.

BSNL is likely to get back around 80-90 percent of what
it had paid last year, about Rs 6,700 crore. We were forced to take spectrum
in many circles and we are getting an opportunity to improve our financials,”
BSNL official added.

Recently, the Indian Government allowed pooling and
sharing of spectrum in the Draft National Telecom Policy 2011 (NTP 2011). The
new directive will enable many operators to earn revenue from their unused
spectrum. However, the NTP 2011 has been delayed and the industry is expecting
the finalization of the policy before March 2012.

The Finance Ministry, which is under pressure to meet the
fiscal deficit target during the current financial year, has written a letter
to the Department of Telecom (DoT) to auction spectrum to earn additional
revenues.

The proposed Spectrum Act will clear the air of spectrum trading. The
government will undertake spectrum audit that would ensure that spectrum, being
a scarce resource, is being utilized effectively and efficiently.

Since the ministry would be preparing a roadmap for availability of additional
spectrum every five years, Indian telecom operators will be able to plan their
investments in advance.

The telecom ministry is likely to auction one slot of broadband wireless access
(BWA) licence spectrum on pan-India basis after getting back airwaves from the
state-run BSNL.

The DoT has given in-principle approval to the BSNL’s
proposal of surrendering its BWA licence in nine circles, out of the total 22
service areas for which the telecom operator had paid over Rs 8,500 crore last
year, according
to a PTI report.

The BWA auction was for two slots of 20 MHz each of
pan-India spectrum. The government had raised 67,719 crore from 3G spectrum auction,
while it got Rs 39,000 crore through BWA auction.

The auction money is significant for BSNL that had
registered a loss of over Rs 6,000 crore for fiscal 2010-11, mainly due to high
staff cost and payments made for acquiring 3G and BWA spectrum.

By Danish Khan
[email protected]