Ministry of FinanceDepartment of Economic Affairs July 04, 2008 Spectrum Issues - Update (Update on Papers dated February 11, April 17 & 29, and June11, 10, 27 & 30, 2008)
1. Meetings took place between Finance Minister and Minister of Telecommunications on May 29, 2008 and June 12, 2008 toresolve outstanding issues relating to allocation and pricing of 2Gand 3G spectrum bands. The DEA paper, in following paragraphs,attempts to consolidate the position on the outstanding issues.2.The issues that are taken up for discussion in this paper aresummarized as under:
Raising spectrum usage charges for 2G spectrum
Pricing of spectrum for 2G allocations
Method of allocation of 3G spectrumI.
Spectrum Usage Charge for 2G Spectrum
3. Spectrum usage charge is pegged to the bandwidth and iscalibrated as a percentage of the Adjusted Gross Revenue (AGR).In view of historical legacy reasons and the administrative issuesinvolved in changing an established practice, it was decided tocontinue with the current practice of levying spectrum usagecharges on the basis of varying percentages of AGR for differentbandwidths of spectrum. 4.It has been agreed to raise the rates as indicated in Table 1below. This will yield revenue of Rs 4,149 crore in 2008-09, an