S w

W12509

PRICING TELECOM LICENCES IN INDIA1

Srabanti Mukherjee and Debdatta Pal wrote this case solely to provide material for class discussion. The authors do not intend to
illustrate either effective or ineffective handling of a managerial situation. The authors may have disguised certain names and other
identifying information to protect confidentiality.

Richard Ivey School of Business Foundation prohibits any form of reproduction, storage or transmission without its written
permission. Reproduction of this material is not covered under authorization by any reproduction rights organization. To order copies
or request permission to reproduce materials, contact Ivey Publishing, Richard Ivey School of Business Foundation, The University
of Western Ontario, London, Ontario, Canada, N6A 3K7; phone (519) 661-3208; fax (519) 661-3882; e-mail cases@ivey.uwo.ca.

Copyright © 2013, Richard Ivey School of Business Foundation Version: 2013-02-20

The path-breaking judgment of the Supreme Court of India 2 on February 2, 2012, had perplexed the
country’s Department of Telecommunications (DoT). The Supreme Court avowed that the arbitrary
allocation of 2G3 telecom licences was an example of sheer misuse of power. The court, therefore,
declared all the 122 telecom licences allotted on or after January 10, 2008 to 11 private telecom players
during the tenure of the former Indian telecom minister, A. Raja, as completely illegal 4 and cancelled
them.5 With this decision, the DoT was left with a considerable amount of spectrum (radiofrequency
wave) that was earlier bundled with those 122 licences. Therefore, along with the spectrum to be allocated
to new applicants, the DoT was supposed to decide on the process of assigning and allocating this huge
amount of free spectrum.

Spectrum is a scarce natural resource that is widely used in the telecom industry for wireless operations,
especially for 2G and third-generation (3G) 6 wireless telephony. The Wireless Planning and Coordination
wing, the DoT, the Ministry of Communication and Information Technology (MoCIT) and the
Empowered Group of Ministers (EGoM) formed by MoCIT were responsible for any decision regarding
spectrum allocations and telecom licensing. 7 Hence, for any joint decision on this public policy issue to be
enacted, consensus among these entities was required. Although the Telecom Regulatory Authority of
1
This case has been written on the basis of published sources only. Consequently, the interpretation and perspectives
presented in this case are not necessarily those of the Department of Telecommunications or any of its employees.
2
The Supreme Court was the top judiciary structure of the country followed by high courts of respective states. High courts
are followed by district courts and sub-divisional courts.
3
2G refers to second-generation wireless telephone technology, which was launched in 1991. 2G was an advancement
over the first-generation technology in terms of digital encryption and introduction of text messaging.
4
“2G Verdict: A Raja, ‘Virtually Gifted Away Important National Asset,’ Says Supreme Court,” Times of India, February 2,
2012, http://articles.timesofindia.indiatimes.com/2012-02-02/india/31016547_1_2g-raja-swan-telecom, accessed September
9, 2012.
5
J. Venkatesan, “Supreme Court Scraps UPA’s ‘Illegal’ 2G Sale,” The Hindu, February 2, 2012;
www.thehindu.com/news/national/article2853159.ece, accessed August 10, 2012.
6
The term 3G refers to the third-generation of mobile telecommunications technology. It complies with a set of specifications
and protocols mentioned in the International Mobile Telecommunications-2000 (IMT-2000) for mobile devices and mobile
telecommunication services. The additional features 3G offers over 2G are wireless voice telephony, mobile Internet access,
fixed wireless Internet access, video calls and mobile TV.
7
Ponapa Shyam, “Open Spectrum for Development India Case Study,” Association for Progressive Communications (APC),
November 2010, http://cis-india.org/about/telecom/publications/india-untapped-potential, accessed September 23, 2012.

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India (TRAI), as a regulator, had put forth its recommendations for licensing and telecom tariffs, the DoT
secretary was supposed to finally issue the telecom licences and allocate spectrum.8

The Supreme Court opined that, spectrum being a natural resource, its proper allocation and utilization
was the solemn responsibility of the government. It further added that it was the duty of the state to
protect the national interest and ensure that natural resources were always utilized for the country’s well-
being and not for any deliberate private benefits. 9 Therefore, based on the recommendations of TRAI and
varying opinions of other deciders, the DoT (under MoCIT) was supposed to take the final decision on
whether re-auctioning was required or not. Kumar Mangalam Birla, the promoter of Idea Cellular, said, “I
think we need to wait and see what the government comes out with, if there is a re-auction. If so at what
price, what would happen to existing infrastructure. So it is a little early to comment on whether we
will participate or not.”10

INDUSTRY OVERVIEW

Being an emerging economy, India was in the limelight as one of the fastest growing telecom markets
across the globe, owing to its growing telecom network, population explosion and immense development
potential.

Until 1994, the DoT enjoyed the monopoly rights to provide communication facilities in India. In 1994,
only three years after the New Economic Policy 1991 11 was announced and privatization paved the way,
private players were invited to invest in the telecom sector and provide telecom services across the
country for the first time. Thereafter, among a few service sectors in India, the telecom industry also
witnessed widespread structural and institutional reforms.

As of December 2011, the total number of connections in the country reached 926.55 million (see Exhibit
1). The scenario was even more encouraging with the overall tele-density12 reaching 167.47 per cent13
(see Exhibit 2). In mobile telephony as well, the country demonstrated a promising trend, with the number
of mobile phone subscribers at 893.86 million (see Exhibit 3). In the wireless segment, 8.35 million new
subscribers were added in May 2012.14

8
“Spectrum Allocation: Government to Go Ahead with Refarming Plan,” The Economic Times, August 13, 2012,
http://articles.economictimes.indiatimes.com/2012-08-13/news/33182817_1_mhz-band-refarm-spectrum-upcoming-2g-
auctions, accessed September 14, 2012.
9
Singh Sandeep, “TCI Dials FM on Coal FSA,” April 13, 2012, www.indianexpress.com/news/tci-dials-fm-on-coal-
fsa/936192/, accessed on August 10, 2012
10
“Cancellation of 2G Licence a Bolt from the Blue: K Birla,” DNA, February 14, 2012,
www.dnaindia.com/india/report_cancellation-of-2g-licence-a-bolt-from-the-blue-k-birla_1650229, accessed June 15, 2012.
11
Economic liberalization in India goes back to when Prime Minister P.V. Narasimha Rao and Finance Minister Manmohan
Singh initiated some breakthrough reforms stipulated by the International Monetary Fund (IMF). Since independence from
British colonial rule in 1947, India had primarily followed a socialist approach with an import-substitution policy. Focus was
primarily on developing government-owned institutions along with some that were privately held. There were at least two
attempts, first in 1966 and then in 1985, to liberalize the economy, but the first was almost reversed in 1967. In the second
attempt, Prime Minister Rajiv Gandhi was to some extent successful in initiating a pro-business policy orientation. But, in
1991, the situation worsened when India faced a serious balance of payments crisis and had to pledge gold with the Union
Bank of Switzerlandand the Bank of Englandas part of a bailout package from the IMF. In addition, the IMF pushed India to
follow a series of structural economic reforms, which included opening the economy, deregulation, privatization and tax
reforms, to name a few.
12
Tele-density is the number of telephone connections in use for every 100 individuals living within a geographic area.
13
Department of Telecommunications Annual Report 2011—12, www.dot.gov.in/annualreport/AR%20Englsih%2011-12.pdf;
accessed August 10, 2012.
14
“Highlights of Telecom Subscription Data as on May 31, 2012,” PDF Press release,
www.trai.gov.in/WriteReadData/PressRealease/Document/PR-TSD-May12.pdf, accessed August 10, 2012.

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Since 1999, apart from the public sector enterprises Bharat Sanchar Nigam Limited (BSNL) and
Mahanagar Sanchar Nigam Limited (MTNL), a few private operators such as Bharti-Airtel, Idea,
Reliance, Tata DoCoMo, Aircel and Vodafone-Essar had also gained significant market share. The three
leading GSM (global system for mobile communications) service providers — Bharti-Airtel, Vodafone-
Essar and Idea — controlled nearly 70 per cent of the market share (see Exhibit 4), and these companies
reportedly shared 65 per cent of the total revenue. 15 The entry of private sector players in the Indian
telecom domain resulted in a drastic reduction in local call tariffs for mobile phones from INR16 16 per
minute in 1999 to INR1 per minute in 2007.17 This further declined to around 60 paise 18 per minute for
mobile users. The system of number portability was introduced in early 2011, whereby users could switch
from one service provider to another while retaining their old number. 19 Further, the Telecom Policy 2012
proposed to withdraw roaming charges for mobile users, who were paying extra charges for moving out
of their circle.20

THE DEPARTMENT OF TELECOMUNICATIONS (DOT)

The DoT, alternatively known as the Door Sanchar Vibhag, was the entity that enacted all policy-related
decisions in the telecom sector. The DoT handled the procedures of licensing and was responsible for the
coordination of all activities related to telegraphs, telephones, wireless, data, facsimile and telematic
services. The DoT was responsible for the enforcement of laws with respect to any issues arising out of
the following Acts:

 The Indian Telegraph Act, 1885.

 The Indian Wireless Telegraphy Act, 1933.
 TheTelecom Regulatory Authority of India Act, 199721

THE EMERGENCE OF THE TRAI

The liberalization measures announced in the New Economic Policy 1991 attracted private players to join
the Indian telephony network. With the increasing number of players, the need for a regulatory authority
was essential. Consequently, through the Telecom Regulatory Authority of India Act, 1997, TRAI was
constituted and enacted effective February 20, 1997. TRAI’s aim was to regulate telecom services,
especially the fixation/revision of tariffs, licensing, etc. It was also TRAI’s mission to craft and cultivate
the growth of telecommunications in the country, especially to increase telecom penetration in rural areas.
It was assumed that TRAI would lead the way to create a momentum in telecom penetration in the
country and enable India to become one of the leaders in the emerging global information society.
Further, TRAI’s principal objective was to ensure a fair and transparent policy environment to accelerate
fair competition. Governed by a clear mission and vision, TRAI issued several necessary regulations,
orders and directives to spearhead the growth of the Indian telecom market. These directives and
15
“India’s the Most Complicated Market: Marten Pieters, CEO, Vodafone India,” Economic Times, August 10, 2012;
http://articles.economictimes.indiatimes.com/2012-08-10/news/33137568_1_market-share-indian-operations-marten-
pieters,accessed September 10, 2012.
16
One US$ = 51.90 Indian Rupee (INR) on September 5, 2012.
17
DoT Annual Report 2007—08, www.dot.gov.in/annualreport/2008/English%20annual%20report%202007-08.pdf, accessed
August 10, 2012.
18
Indian Rupee was subdivided into 100 paise.
19
“Mobile Number Portability at Rs19,” NDTV News, January 21, 2011, www.ndtv.com/article/india/mobile-number-
portability-at-rs-19-80612, accessed October 2, 2012.
20
“No Roaming Charge from Next Year,” The Times of India, September 25, 2012,
http://timesofindia.indiatimes.com/business/india-business/No-roaming-charge-from-next-year/articleshow/16534990.cms?
accessed October 2, 2012.
21
DOT, www.dot.gov.in/objective.htm, accessed February 10, 2012.

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guidelines helped the Indian telecom industryto evolve from a public sector monopoly into a multi-
operator/multi-service, open and fairly structured competitive framework. The issues addressed by TRAI
thus far were related to telecom tariffs, interconnection and excellence of service and governance of the
sector. Considering its huge responsibility in terms of adjudicatory functions and dispute settlement, the
TRAI Act was amended and the Telecommunications Dispute Settlement and Appellate Tribunal
(TDSAT) was set up by an ordinance effective January 24, 2000. TDSAT was supposed to adjudicate
“any dispute between a licensor and a licencee, between two or more service providers, between a service
provider and a group of consumers, and to hear and dispose of appeals against any direction, decision or
order of TRAI.”22

PREVIOUS DECISIONS

In 1993—94, the tele-density in India was at 0.8 connections per 100 persons, which was quite low
compared with the world average of 10 connections per 100 persons. Even compared with other
developing Asian countries such as China (1.7), Pakistan (2) and Malaysia (13), India’s tele-density
appeared to be quite low. A new connection in India would entail long queues and lead time. The country
had only eight million existing connections and a long waiting list of about 2.5 million. The numbers for
rural areas were quite insignificant, with a coverage of only 0.14 million villages out of the total 0.58
million.23

Given this scenario, the Government of India announced its first National Telecom Policy in 1994 (NTP-
94). The key intention of the policy was

 to provide telephone services on demand,

 to establish a world-class tele-network at reasonable prices, and
 to ensure universal access of basic telecom services to all villages.

It was pretty clear to the government that such optimistic targets required huge resources, which it did not
have. Hence, private investment was needed to bridge the large resource gap.

The enactment of NTP-94 accelerated the growth in the telecom sector. Around 0.1 million public call
offices (PCO) were established in urban areas, and this ensured the availability of at least one PCO per
522 persons. Approximately 0.31 million villages were covered by the telephony network. DoT installed
8.73 million new connections after NTP-94.

With the expansion of land and mobile networks in the metropolitan areas and states, the difference
between actual and projected revenues was quite large. This crippled operators in terms of project
financing; thus, several targets set under NTP-94 were not met. This in turn called for a marriage between
the market development strategy and infrastructure and technology upgrade, which required a realignment
of the entire industry.24 A new telecom policy framework was essential, so the government announced
NTP-99, effective April 1, 1999. The licensing of all telecom services was kept under the policy
framework of NTP-99 after consideration of the competitive nature of the industry subsequent to the
opening up of the economy.

22
TRAI, www.trai.gov.in/Content/History.aspx, accessed August 11, 2012.
23
Tomar Jaipal Singh, “Converged Licensing Regime: Telecom Licensing Framework,” www.itu.int/ITU-
D/asp/CMS/Events/2012/ITP2012/Jaipal_Singh_Tomar_TelecomLicensingFramework.pdf, accessed August 20, 2012.
24
Ibid.
22 “
Performance Audit Report on the Issue of Licences and Allocation of 2G Spectrum by the Department of
Telecommunications,” Report of the Comptroller and Auditor General of India for the Year Ended March 2010.

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As a significant variation from the previous policy, NTP-99 removed the restrictions on the number of
service operators that could be basic service providers as well as cellular mobile service providers.
Subject to the fulfillment of the conditions of the DoT, the market was open to all potential bidders.
Another significant change in NTP-99 was a deliberate move from the fixed licence fee system to a
revenue sharing scheme, through which the government charged operators a portion of their adjusted
gross revenue (AGR) as a yearly licence fee for using spectrum. The percentages of AGR were mostly
calculated based on the operational zones of the concerned operator. The 20 telecom circles for basic
telephony and 18 circles for mobile services were segregated into A, B, and C categories on the basis of
their value of revenue.25 In 2000, TRAI recommended selection of new operators among the private
players, following a multi-stage informed ascending bid preceded by a qualifying stage of
technical/business feasibility. BSNL and MTNL, being Government of India enterprises, enjoyed an
exemption from bidding (see Exhibit 5).

In 2001, for the first time, the principle of first-come-first-served was introduced for spectrum allocation
for basic services with wireless in local loop. Unlike the fixed licence fee regime, now the licences for the
fourth-phase cellular operators26 were issued on the basis of open bidding subject to an entry fee. 27 By
October 2001, 17 fresh licences were issued to private companies. The licences allowed the companies to
operate in each of the four metro cities — namely, Delhi, Mumbai, Kolkata and Chennai — and 13
telecom circles. The total revenue received as entry fee amounted to INR16.58 billion. Note that this total
revenue was only half of the amount charged as a “migration package” for the first and second cellular
mobile telephone service operators in 1999 when renewing their licences. In January 2001, the annual
licence fee was gradually lowered for almost all types of circles (from a 15 per cent flat rate to 12 per cent
for “A” circles, 10 per cent for “B” circles and 8 per cent for “C” circles).

As a step further for the advancement of Indian telephony, in September 2003, the EGoM recommended
granting unified access services (UAS). 28 This refers to a situation where, based on the licence agreement,
licenced mobile service operators within their jurisdiction were authorized to provide “all types of mobile
services including voice and non-voice messages, data services and [PCOs] utilizing any type of network
equipment, including circuit and/or package switches that meet the relevant International
Telecommunication Union (ITU)/Telecom Engineering Centre (TEC) standards.”29

Accordingly, the union cabinet of the National Democratic Alliance (NDA) 30 regime approved the policy
for licensing UAS for all services and de-linking spectrum allocation from licences. This was followed by
recommendations proposed by TRAI on October 27, 2003: “It is recommended that within six months
unified licensing regime should be initiated for all services covering all geographical areas using any
technology.”31

25
Telecom Regulatory Authority of India, “Consultation Paper on Auction of Spectrum,” Paper no 04—2012, March 7, 2012,
www.trai.gov.in/WriteReaddata/ConsultationPaper/Document/consultation%20paper%20spectrum%20of%20auction.pdf,
accessed August 11, 2012.
26
BSNL was the third cellular service operator. However, licences for the fourth cellular operator, the private players, were
selected based on a multi-stage bidding process subject to paying annual spectrum charges over and above the licence fee.
27
“Developments in the Telecom Sector, Award of 2G Licences in 2007 — 08 and Subsequent Observations of Audit Policy
Perspectives Status Report,” January 7, 2011, pib.nic.in/archieve/others/2011/jan/d2011010701.ppt, accessed September
11, 2012.
28
The Gazette of India, “Extraordinary, Part III, Section 4, Telecom Regulatory Authority of India,” December 1, 2010.
29
Cellular Mobile Telephone Service, www.dot.gov.in/cmts/cmtsindex.htm,accessed September 12, 2012.
30
Presently chaired by the former prime minister, Atal Bihari Vajpayee, and convened by Sharad Yadav, the NDA was a
coalition of Bharatiya Janata Party and 13 other parties. It was formed in 1998.
31
“Telecom Policy: Back to the Future,” April 12, 2012, www.hindustantimes.com/business-
news/ColumnsBusiness/Telecom-policy-back-to-the-future/Article1-684480.aspx, accessed on August 12, 2012.

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On October 31, 2003, the union cabinet embarked on the path to a universal licensing regime. After this
approval, on November 11, 2003, further guidelines for the issue of licences under UAS were given, and
all telecom service licences were granted solely on the basis of UAS.Further, in September 2006, TRAI,
in its report submitted to the Government of India, recommended the auctioning of 3G spectrum. It also
recommended a reserve price for a single block of pan-India 3G spectrum (2x5MHz) at INR10.1 billion.
The EGoM, constituted to monitor issues pertaining to the auction process, agreed on such a cap and
further increased its value to INR35 billion.

In April 2007, seeing that the existing spectrum was not adequate to cater to the increasing demands of
UAS licencees, the DoT looked towards TRAI to identify some criteria to put a cap on the number of
UAS service providers in a service area, but in August that year TRAI did not agree to do this.

TRAI clearly recommended that “A licencee using one technology may be permitted on request, usage of
alternative technology and thus allocation of dual spectrum.32 However, such a licencee must pay the
same amount of fee which has been paid by the existing licences using the alternative technology or
which would be paid by the new licencee going to use that technology.”33

Note that India was divided into 22 telecom zones. The total number of zonal licences available in the
market was as much as 281.34 According to the recommendations in NTP-99, along with a licence, the
operator also receives some start-up spectrum, mainly because the policy had an auctioning system for
licences but not for spectrum. Accordingly, the DoT issued 122 new licences to 17 companies in 2008, of
which 35 licencees were allowed to use dual spectrum.

CONTROVERSIES

Soon after the allocation of these 122 new 2GUAS licences to 17 telecom companies at the 2001 price on
a first-come-first-served basis, the entire nation experienced shockwaves from many controversies and
litigations. These were made public when a non-government organization (NGO), the Telecom
Watchdog, lodged a complaint with the Central Vigilance Commission (CVC) on the irregularities in the
spectrum allocation to Loop Telecom in May 2009. This was followed by another complaint filed by
Arun Agarwal, who highlighted that a licence was granted to Swan Telecom at throwaway prices. In
response, the CVC asked the Central Bureau of Investigation (CBI) to probe these issues. 35 In 2008, the
CBI filed a charge sheet against the DoT, seeking an explanation with regard to the violation of several
rules of NTP-99 and corruption issues related to the allocation of 2G licences. As a consequence, Time
magazine, in its new list of the “Top 10 Abuses of Power,” listed Telecom Minister A. Raja’s so-called
2G scam at number two, just after the famous “Watergate” scandal in 1974 in the United States.

32
Dual technology refers to the combination of CDMA and GSM technology. CDMA (code-division multiple access) refers to
the protocol that provides advanced services to 2G and 3G wireless communications. Being a form of multiplexing, CDMA
allows a large number of signals to operate through a single transmission channel and thereby optimizes the use of scarce
electro-magnetic bandwidth, which is alternatively known as spectrum. Ultra-high-frequency (UHF) cellular telephone
systems in the 800-MHzand 1.9-GHz bands call for application of CDMA for its operations. On the other hand, the GSM
(global system for mobile communications, originally group especial mobile), introduced by the European
Telecommunications Standards Institute, refers to a standard set of protocols for 2G digital cellular for mobile telephony.
33
Public Accounts Committee (PAC) Report, 2011, Chapter 1,
www.tehelka.com/channels/Web_Specials/.../PAC_REPORT.doc, accessed August 12, 2012.
34
“How Raja Misused PM’s Letter While Allocating 2G Licences,” NDTV, September 28, 2011,
www.ndtv.com/article/india/how-raja-misused-pm-s-letter-while-allocating-2g-licences-136810, accessed October 3, 2012.
35 “
2G Scam: Despite CBI, Raja Gets Bail,” The Financial Express, http://m.financialexpress.com/news/2g-scam-despite-cbi-
raja-gets-bail/949575/, accessed September 10, 2012.

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Issues came to the forefront when the president of the Janata Party, 36 Subramanian Swamy, and an NGO,
the Centre for Public Interest Litigation, appealed to the Supreme Court for the cancellation of the 122 2G
licences. In response, Justice G.S. Singhvi and Justice A.K. Ganguly stated:

The licences granted to the private respondents — Etisalat DB Telecom (Swan Telecom);
Unitech Wireless; Loop Telecom; Videocon Telecommunications; S-Tel Ltd; Allianz Infratech;
Idea Cellular and Aditya Birla Telecom (Space Communications); Tata Teleservices; Sistema
Shyam Tele Services (Shyam Telelink); Dishnet Wireless; [and] Vodafone Essar South — on or
after January 10, 2008, pursuant to two press releases issued on January 10, 2008, and the
subsequent allocation of spectrum to the licencees are declared illegal and are quashed.37

Moreover, the comptroller and auditor general of India (CAG), while probing the issue, put forward these
irregularities in the allocation of 2G licences and spectrum:

 Some firms such as Unitech and Swan Telecom managed to get licences with no prior experience in
the telecom sector.
 Based on NTP-99, some firms such as Swan Telecom that were found to be non-eligible received
licences easily, and some such firms had even held back pertinent facts.

As a matter of fact, earlier, in November 2007, Raja had received a letter from Indian Prime Minister
Manmohan Singh with clear directives to ensure transparency and impartiality in the allotment of 2G
spectrum and to safeguard the proper revision of existing licence fees. The telecom minister refused to
follow many of these recommendations. He did not address the procedural concerns raised by the
Ministry of Finance in an official letter in the same month, and his department went ahead with its
original plan of giving 2G licences at the prices set in 2001 for 3G licences. Further, the entire process
was full of anomalies. First, the cut-off date was suddenly advanced from October 1, 2007 to September
25, 2007. Secondly, without warning, a peculiar announcement was posted on the DoT website stating
that those who applied between 3:30 p.m. and 4:30 p.m. on the same date would be issued licences. This
announcement sounded strange to the CAG as well as to all the stakeholders and the national populace in
general.38

More surprisingly, Unitech Wireless, a subsidiary of Unitech Group, which received a licence for
INR16,610 million without any prior experience in the telecom sector, sold 60 per cent of its share for
INR62,000 million to the Norway-based company Telenor.

Later, Swan Telecom, which received a licence for a throwaway price of INR15,370 million in spite of
being ineligible, sold a 45 per cent stake to a United Arab Emirates based company, Etisalat, for
INR42,000 million (US$760.2 million) and earned a profit of INR26,630 million.39

The CAG estimated a loss of INR1,760 billion from improper licence as well as spectrum allocation. The
auditor claimed that the 2G licence allocation process “lacked transparency and was undertaken in an
arbitrary, unfair and inequitable manner”40 because the DoT did not follow the guidelines of NTP-99,
36
India has a multi-party political system. The Janata Party was formed in 1977 by an amalgamation of some Indian political
parties that were against the State of Emergency declared by the government led by the Indian National Congress.
37
Venkatesan, “Supreme Court Scraps UPA’s ‘Illegal’ 2G Sale.”
38
“2G Spectrum Scam: Chronology of Events,” Economic Times, May 20, 2011,
http://articles.economictimes.indiatimes.com/2011-05-20/news/29564752_1_2g-spectrum-case-licence-fee, accessed
September 12, 2012.
39
“What is 2G Spectrum Scam?,” NDTV, May 5, 2011, www.ndtv.com/article/india/what-is-2g-spectrum-scam-66418,
accessed August 12, 2012.
40
“What is 2G? What is 2G Scam?” MSN News, February 4, 2012, http://news.in.msn.com/national/what-is-2g-what-is-2g-
scam, accessed August 12, 2012.

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arbitrarily altered the cut-off date for applications and gifted “unfair advantage” to a few companies over
others. Despite the NTP-99 recommendation that the number of applicants not be capped, the DoT had
imposed a cap on applications by granting licences only to those firms that had applied by September 25,
2007. Now that the Supreme Court had cancelled 122 such licences, a huge amount of spectrum was
available with the DoT. Spectrum, being a valuable natural resource, needed to be quickly put to use.

SPECTRUM: PROPERTIES AND ALLOCATION

As mentioned in the introduction to this case, radio frequency spectrum, which is mostly used for 3G or
2G telephony services, comprises the entire range of wavelengths of electromagnetic radiation. Especially
due to its scarcity as a natural resource and its extensive requirement in the telecom sector, spectrum is
highly valuable.

Some of the atypical characteristics of the radio frequency spectrum are as follows:

 Radio frequency spectrum is normally spread over a large topographic area and, therefore, is
independent of geographic borders between countries.
 Overlapping interference may pose hindrance to the effective use of spectrum, thus requiring
sophisticated engineering tools to ensure interference-free operation of several wireless networks.
 Spectrum is unique in comparison to other natural resources in the sense that it is not depleted by use.
Nonetheless, if not optimally utilized and allocated, such a scarce natural resource could be
unnecessarily wasted.

Spectrum was allocated mostly on a regional basis according to the frequency specifications determined
by the International Telecommunication Union. Though the range of frequency varies from 9KHz to
1,000GHz, in India, the radio frequencies used were usually limited between 9KHz and 400GHz.

In India, mobile telephony used either GSM or CMDA technology. GSM technology can operate in the
frequency bands of 900MHz and 1,800MHz. CDMA technology works in the 800MHz band. Earlier, the
Indian army used mobile telephony on 800MHz, 900MHz and 1,800MHz bands. Of late, 25MHz
spectrum in the 900MHz band (890—915/935—60 MHz) and 75MHz in the 1,800MHz band (1,710—
85/1,805—80 MHz) were reserved for GSM services.41 In its report submitted in 2010, TRAI claimed
that 2G services were in fact offering 2.75G services. Therefore, the initial recommendation was to adopt
the 3G price in the frequency of 1,800MHz as the price for 2G. Later, TRAI recommended that 2G prices
should be kept at least 1.5 times higher than 3G prices, because 2G is mostly operated in the frequency of
800MHz and 900MHz band.

The spectrum frequency requirements for 2G and 3G, which are contingent upon the type of service that
the frequency will be used for, are varied, and spectrum itself is a natural resource; thus, its scarcity factor
had a serious impact in shaping the demand and supply curves to arrive at an optimum price. This was
quite evident between September 2007 and December 2008, when owing to massive use of mobile
telephony across the country, the demand for spectrum reached its peak and the scarcity was highly
visible. Even if spectrum had been sold at 3G rates (according to the UAS licence fees) in 2008 (as the
spectrum valuation had become manifold during this time span), 42 then according to the CAG’s estimates,
the DoT would have realized INR1,115.12 billion, which is much higher than the INR90.14 billion
amount actually realized by the DoT by setting the 2001 price of 3G as the entry fee. Similarly, it was

Public Accounts Committee (PAC) Report.

41

Hui Pan, ed., “ED Tells SC That 2G Spectrum Scam Probe is Underway,” India Telecom Monthly Newsletter (Information
42

Gatekeepers Inc), October 2010.

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 Page 9 9B12A0

observed that for spectrum allotted under the dual technology to 35 licencees, the DoT could have
obtained INR405.26 billion on the basis of the 2008 price. Nonetheless, in reality, only INR33.72 billion
was collected. The total loss for DoT, therefore, was calculated to be INR1,396.52 billion. 43 Although this
was a notional loss to the DoT, the CAG believed that the exact value of 2G spectrum could have been
discovered only through a well-organized, market-determined process. Otherwise, the loss was inevitable.

The CAG’s arguments in favour of a price discovery mechanism were simple. The auditor stated that in
the same time frame, the huge revenue that was realized through the auction of 3G not only fetched the
benefits of an open price discovery mechanism but also reaped a higher value of spectrum, even after
meeting the requirements of open competition. The auditor’s point was validated by the fact that the
government received INR1,030 billion from the auction of 3G and broadband wireless access spectrum
after a simultaneous ascending auction, where spectrum in all 22 circles came under bidding at the same
time.44 This was much higher than the DOT’s original estimate of INR350 billion, which suggests that the
DoT had underestimated its earnings from the auctions by almost INR680 billion. However, Ved Jain, the
former president of the Institute of Chartered Accountants of India, stated that “The calculation based on
the auction of 3G spectrum is not the right thing. The telecom scenario in the country in 2008 was
completely different from 2010. The market hadn’t heated up as it had during the 3G auctions.”45

THE REVERBERATION

Given the changed industry scenario in 2010, TRAI had earlier recommended the reserve price for 5MHz
of 2G spectrum to be INR180 billion. Currently, the obtainable spectrum with the DoT in the 1,800 MHz
band was 576.20 MHz. In 2010-11, based on the existing State Bank of India determined Prime Lending
Ratio of 12.63 per cent, the reserve price per MHz for 3G auction (in the bandwidth of 1,800 MHz) was
calculated after adjusting the price with an efficiency factor of 1.2. Further, for calculating the equal
monthly installments for the first twenty years for paying the auction reserve price, the annual interest rest
was assumed to be 15 per cent. This assumption was based on the erstwhile practice of using 15 per cent
as an average return on capital employed.46 However, in response to the 2G scam, the Telecom
Commission had invited a detailed analysis from TRAI on the impact of the proposed spectrum pricing
on the industry.47 Upon receiving this report, the EGoM, headed by the finance minister, accepted its call
on setting the spectrum prices. Nonetheless, the TRAI’s recommended price was not free from
controversies. A partner for the advisory service at Ernst & Young, Bharat Bhargava, challenged the
methodology of TRAI’s calculation of the cost impact in terms of its over-simplicity. He stated that TRAI
“has divided the amount of spectrum to be auctioned . . . by total number of minutes being used by all
telecom subscribers, which is incorrect.” Moreover, Bhargava claimed that since TRAI did not reflect the
spectrum quantity that supported a subscriber’s monthly average use of 332 minutes (of which incoming

43
Performance Audit Report on the Issue of Licences and Allocation of 2G Spectrum by Department of
Telecommunications; Ministry of Communications and Information Technology; Report of the Comptroller and Auditor
General of India for the Year Ended March 2010, 2010-11, http://cag.gov.in/html/reports/civil/2010-
11_19PA/Telecommunication%20Report.pdf, accessed September 12, 2012.
44
Upadhyay Rajkumar, “Spectrum Auction Methodology 3G and BWA Auctions in India,” April 2012, www.itu.int/ITU-
D/asp/CMS/Events/2012/ITP2012/Rajkumar_Upadhyay_Spectrum.pdf, accessed September 12, 2012.
45
“Sprinkle Some Zeroes to Spice up a Scam,” The Telegraph, November 19, 2011,
www.telegraphindia.com/1101119/jsp/frontpage/story_13195587.jsp, accessed October 2, 2012.
46
TRAI Recommendations on Auction of Spectrum, April 23, 2012,
www.trai.gov.in/WriteReadData/Recommendation/Documents/Finally%20final%20recommendations230412.pdf; accessed
September 19, 2012
47
“Telecom Commission Asks TRAI for Analysis on 2G Pricing,” www.thehindubusinessline.com/industry-and-economy/info-
tech/article3459428.ece, accessed on August 15, 2012.

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and outgoing calls were 171 minutes and 161 minutes, respectively), 48 the flow of revenue was restricted
for only outgoing pulses. Bhargava’s argument was that this resulted in a lower denominator in the
calculation of the cost impact.49

R. Chandrashekhar, the chairman of the Telecom Commission and the secretary of the DoT, stated that
equilibrium was required between the spectrum price and some other factors such as profit to the
government, tariff to consumer, feasibility of investment and sustained appeal of the sector. Therefore, he
suggested that the DoT, parallel to TRAI, should also make an independent analysis. Based on both
analyses, the EGoM would make a final call.

In an attempt to recover the losses to the national exchequer, some measures such as spectrum exit policy,
auctioning of 2G spectrum and a revised licensing fee linked to 3G auctions had been recommended by
TRAI.50 Currently, the spectrum cap had been set at 4.4MHz for the operators who entered into the
licensing scheme in 2008. Current GSM operators, who held excess spectrum in addition to the contracted
6.2MHz, would be asked to pay on a pro-rata basis.

For the pro-rata payments, TRAI recommended the following two possible alternatives:

 2G spectrum price to be set at INR17.70 billion perMHz up to 6.2 MHz.

 For above 6.2 MHz, INR45.72 billion per MHz should be charged on a pro-rata basis.51

Although some of these measures appeared to be beneficial for the telecom operators and the telecom
industry as a whole, almost all the telecom operators (barring Reliance Infotel) opposed TRAI’s pricing
recommendations. Moreover, TRAI was supposed to release specific exit policies; practically no such
explicit exit recommendations existed by which the companies could have surrendered their permits,
although only a few of them intended to do so. TRAI believed that approximately 210MHz of 2G
spectrum could be freed by abandoning 69 mobile service licences issued to the new entrants in the sector
by the DoT during Raja’s ministerial regime.

Finally, in 2012, the Telecom Commission released its recommendation of a uniform licence fee of 8 per
cent of AGR; the prevailing rate of 6 to 8 per cent was based on the variety of service offerings as well as
the circlesin which a telecom company was operating. 52 Operators were asked to return any additional
spectrum held beyond the specified limit until appropriate pricing of this additional spectrum was
determined. This yielded a mixed response among the incumbents. Bharti-Airtel and Vodafone-Essar, the
two major players, welcomed the proposal of uniform fee across licences and circles. 53 However, they
expressed concerns about TRAI’s process for deriving the reservation price. 54 According to TRAI’s
recommendation, the operators had to pay a reservation price of INR181.11 billion for a pan-India licence

48
“Impact of TRAI’s Spectrum Recommendations on Consumers and Industry: A PWC Assessment and TRAI
Recommendations,” May 2012, www.pwc.com/in/en/assets/pdfs/publications-2012/trairecommendationmcvideo.pdf,
accessed August 15, 2012.
49
“TRAI Made False Assumptions While Calculating Tariff: Study,” Telecom Tiger, June 4, 2012,
www.telecomtiger.com/PolicyNRegulation_fullstory.aspx?storyid=14479&flag=1&passfrom=topstory&section=S174,
accessed September 12, 2012.
50
“Aftermath of 2G Scam — Spectrum Pricing and Auctions,”www.indiatelecombrief.com/from-the-editors-desk/84102-
aftermath-of-2g-scam-spectrum-pricing-and-auctions, accessed August 15, 2012.
51
“2G Spectrum up to 6.2Mhz to Cost 53%of 3G; Beyond,136%,” The Financial Express, February 9, 2011,
http://business.illinois.edu/subsistence/docs/RMAI.pdf,accessed August 15, 2012.
52
“Telecom Panel for Uniform Licence Fee of 8%,” The Hindu, December 27, 2011,
www.thehindu.com/business/Industry/article2752516.ece, accessed September 18, 2012.
53
“Experts Want Clarity on Spectrum Pricing,” Business Standard, February 17, 2012, www.business-
standard.com/india/news/experts-want-clarityspectrum-pricing/464943/, accessed October 1, 2012.
54
“Impact of TRAI’s Spectrum Recommendations.”

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in 1,800MHz to obtain 5MHz, which is nearly 10 times more than the price set in 2008 and 7.6 per cent
higher than that of the 3G licence auction held in 2010.

Savings for service providers would primarily come from: (1) technology-neutral spectrum, where
operators could use the spectrum for any of the 2G, 3G and 4G licences; (2) the scope to pay over 12
years for the winning operators, with the initial bid amount of 25 to 33 per cent; and (3) uniformity in
licence fees.55 However, Devendra P.S. Seth, former chairman and managing director of BSNL, believed
that given the high reservation price, many operators could be restricted to bidding in category “C”
circles, which were less costly. 56 Moreover, the Cellular Operators Association of India (COAI), the
industry body of service providers, expressed their concern by stating that the reservation price was high
and by indicating that this would result in an increase of 37 to 49 paise per minute in tariff charges. 57
While the higher reservation price had the potential to yield sizeable revenue for the government, the
policy conflict would be unresolved, making call rates costly for the common man. This would seriously
damage the government’s ambitious plan to reach a rural tele-density of 100 per cent by 2020. 58 Industry
observer Ernst and Young (E&Y) commented that weak business economics could prohibit the entry of
new players. Moreover, TRAI had not differentiated between an existing operator asking for an extension
of licence and a provider not asking for any extension. The differential effect of TRAI’s recommendation
would kill the competitive environment of the market, E&Y claimed. 59

Now both types of operators (those who were holding excess spectrum and those who required additional
spectrum) were eagerly waiting for a final decision on spectrum pricing.

Apart from the private players in the telecom sector, the government itself was looking forward to
restructuring the spectrum pricing, not only to fund the fiscal deficit but also to earn handsome revenue by
auctioning the already cancelled licences. A fast decision was required, because a few major telecom
players would shortly need to renew their licences. Spectrum, being a scarce natural resource, had to be
used in an efficient manner; hence, any interim or long-term pricing decisions would have an immense
impact on shaping the future of the telecom sector.

AFTERSHOCK OF THE SCAM: INVESTOR APATHY

The scam and the subsequent cancellation of licences had resulted in a series of unfavourable
developments for the Indian telecom sector. According to industry estimates, India needed an annual
investment of US$10 billion to keep the plan rolling, but in reality, the telecom sector had received
foreign direct investment (FDI) of only US$1.7 billion during FY2011, which was a sharp decline from
the US$2.6 billion of FDI during FY2010. The industry had also seen a 50 per cent downsizing in
investment by major telecom operators. 60 In addition, financial institutions had also started selectively
lending to telecom projects, owing to uncertain policy perspectives.61 D. Rogozin, the deputy prime
55
“TRAI’s 1800 MHz Spectrum Reserve Price Shocks Industry,” April 24, 2012,
http://voicendata.ciol.com/content/top_stories/112042401.asp, accessed August 15, 2012.
56
“2G Spectrum Re-auctions Ring Alarm Bells,” Express Computer, September 5, 2012,
www.expresscomputeronline.com/features/951-2g-spectrum-reauctions-ring-alarm-bells, accessed September 14, 2012.
57
“Mobile Tariffs Will Go Up 49p: COAI,” India Blooms News Service, August 6, 2012,
www.indiablooms.com/BusinessDetailsPage/2012/businessDetails060812i.php, accessed September 1, 2012.
58
National Telecom Policy 2012 (Preamble), www.dot.gov.in/ntp/NTP-06.06.2012-final.pdf, accessed September 15, 2012.
59
“Impact of TRAI’s Recommendations on Auction of Spectrum on Operator Cost and Consumer Tariffs,” Ernst and Young,
www.ey.com/Publication/vwLUAssets/EY-COAI_Impact-of-TRAIs-recommendation-on-Auction-of-Spectrum/$FILE/EY-
COAI_Impact-of-TRAIs-recommendation-on-Auction-of-Spectrum_Final.pdf, accessed September 13, 2012.
60
“The Indian Mobile Services Industry: Braving the Storm,” Press Release of COAI and PWC, August 11,
2011,http://coai.in/docs/PressReleases/Joint%20Press%20Release%20on%20The%20Indian%20Mobile%20Services%20I
ndustry%20-%20A%20Status%20Check.pdf, accessed September 17, 2012.
61
“2G Spectrum Re-auctions Ring Alarm Bells.”

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minister of Russia, had expressed concern over the cancellation of the 2G licence allotted to Sistema
Shyam Teleservices Ltd., a joint venture between Russia’s Sistema and India’s Shyam Group. He had
sought an amiable resolution to the loss borne by the Russian company.62 In the advent of notices issued
to the government by several foreign players (including Telenor, Sistema, Axiata and Vodafone) asking
for due protection of investments made by them, the DoT had sought the opinion of India’s attorney
general. He opined that foreign investors should have undertaken due diligence before investing in any
Indian firm, and as the cancellation of licences was done by the judicial authority and not by the
government, the latter was not liable for any loss arising from such incidents. 63 As a result, no new
telecom operator came forward with an investment plan, nor did any participate in the pre-2G-bid
conference arranged by the government to investigate investor sentiments. 64 Looking at the situation, the
Ministry of Finance and the Planning Commission opposed the DoT’s proposal to levy auction-
discovered spectrum charge on the existing service providers for 2G mobile services, even for companies
whose licences still had many years for renewal. 65 In addition, a Supreme Court bench headed by Chief
Justice S.H. Kapadia observed that while auctioning may be one of the preferred modes of allotting
natural resources, it cannot be held as a constitutional mandate. The bench further added that revenue
maximization should not be the objective while working for the public good, because public welfare,
rather than natural resources,should be the prime driving motivation for any public policy.66

Therefore, the DoT had many decision dilemmas. First, it had to decide whether to follow a uniform
allocation strategy for three kinds of incumbents (those waiting for renewal, those whose licences were
cancelled and the new applicants). Second, knowing the Supreme Court’s opinion, as auctioning was not
mandatory for natural resource allocation, should the DoT re-auction spectrum at all? If the DoT went for
auctioning, should it bundle spectrum with licences or auction it separately? If auctioned separately, what
should be the minimum reserve price for spectrum, because the procedure of fixing the reserve price had
already generated many controversies? Even if refarming was done, should spectrum be reallocated in the
more efficient 900MHz spectrum through auctions, or, spectrum being a scarce resource, should
allocation be made for 1,800MHz so that it could be distributed to more service providers? Needless to
say, while the allocation of 900MHz spectrum could lead to redundant investments of more than INR
1,500 million to cover the initial fixed cost for setting up additional towers for the 1,800MHz network,
the providers could ask for enhancedcall tariffs, and the existing service providers were not keen to accept
the probability of tariff increases. 67 This was obvious given the “price-stickiness” of the oligopolistic
Indian telecom sector that was dominated by a few large service providers, none of whom wanted to be
victims of higher tariffs. Further, higher tariffs could hamper TRAI’s and the DoT’s basic objective to
increase tele-density across the country, especially in rural areas. Given investors’ apathy and the
ministry’s opposition, the whole nation was waiting to see whether the DoT would stick to the panel’s
recommendation of re-auctioning or not.

62
“Russia Seeks Resolution to Dispute over Cancellation of 2G Licence of Sistema,” The Economic Times, June 21, 2012,
http://articles.economictimes.indiatimes.com/2012-06-21/news/32352178_1_sistema-shyam-teleservices-shyam-group,
accessed September 18, 2012.
63
“Foreign Players Cannot Invoke Bilateral Treaties: Attorney-General,” The Hindu Business Line, August 13, 2012,
www.thehindubusinessline.com/industry-and-economy/info-tech/article3764819.ece, accessed September 15, 2012.
64
“New Foreign Telcos Give 2G Pre-bid Conference a Miss,” Business Standard, September 7, 2012, www.business-
standard.com/india/news/new-foreign-telcos-give-2g-pre-bid-conferencemiss/485649/, accessed September 19, 2012.
65
“Finance Ministry Opposes DoT’s 2G Proposal,” The Times of India, July 3, 2012,
http://articles.timesofindia.indiatimes.com/2012-07-03/india-business/32523087_1_finance-ministry-spectrum-prices-
incumbents, accessed September 12, 2012.
66
“Auction Not the Only Way to Allocate Resources, Says Supreme Court,” The Economic Times, September 28, 2012,
http://articles.economictimes.indiatimes.com/2012-09-28/news/34148495_1_spectrum-licences-2g-natural-resources,
accessed September 12, 2012.
67
“2G Reframing by Mid-2013,” Economic Times, August 14,

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 Page 13 9B12A065
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Exhibit 1

EVOLUTION OF TELECOMMUNICATION NETWORK (BOTH PUBLIC AND PRIVATE SECTOR ENTERPRISE) IN INDIA

December,
March,

March,

March,

March,

March,

March,
March,

March,

March,

March,

March,

March,

March,

March,

March,
1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2011
Public Sector 14.54 17.80 21.59 26.51 32.44 38.16 43.17 46.48 52.09 61.08 71.39 79.55 89.55 105.87 126.00 128.92
Private Sector 0.34 0.88 1.22 2.02 3.85 6.81 11.45 30.06 46.29 81.01 134.48 220.94 340.18 515.41 720.33 797.63
Total 14.88 18.68 22.81 28.53 36.29 44.97 54.62 76.54 98.37 142.09 205.87 300.49 429.73 621.28 846.33 926.55

Source: Various DoT annual reports, Government of India.

Exhibit 2

TELE-DENSITY (NUMBER OF TELEPHONES PER 100 PEOPLE) IN INDIA

December,
March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,
March
1997

1998

1999

2000

2002

2003

2004

2005

2006

2007

2008

2009
20

20

20

20
Rural 0.34 0.43 0.52 0.68 0.93 1.21 1.49 1.55 1.73 1.86 5.89 9.46 15.11 24.31 33.83 37.52
Urban 1.56 1.94 2.33 2.86 3.58 4.29 5.11 7.02 8.95 12.74 18.22 26.22 36.98 52.74 70.89 76.86
Total 4.76 5.78 6.87 8.23 10.37 12.20 14.32 20.79 26.88 39.45 48.10 66.39 88.84 119.45 156.94 167.46

Source: Various DoT annual reports.

 Page 14 9B12A065
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Exhibit 3

SPREAD OF WIRELINE AND WIRELESS TELEPHONES IN INDIA

December,
March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,

March,
March
1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2011
Wireline 14.54 17.8 21.61 26.65 32.71 38.29 41.32 40.92 41.42 40.23 40.77 39.41 37.97 36.96 34.73 32.69
Wireless 0.34 0.88 1.20 1.88 3.58 6.68 13.30 35.62 56.95 101.86 165.09 261.08 391.76 584.32 811.6 893.86

Gross 14.88 18.68 22.81 28.53 36.29 44.97 54.63 76.54 98.37 142.09 205.87 300.49 429.73 621.28 846.33 926.55
Annual growth
(Per Cent) 26 22 25 27 24 21 40 29 44 45 46 43 45 36 9

Source: Various DoT annual reports, Government of India.

Exhibit 4

COMPANY-WISE MARKET SHARE OF GSM SUBSCRIBERS, AUGUST 2012

Sl. No. Name of Company Total Sub Figures Per Cent

Market Share
1 Bharti-Airtel 186,904,110 27.82
2 Vodafone Essar 153,350,950 22.82
3 IDEA 115,973,519 17.26
4 BSNL 94,677,766 14.09
5 Aircel 65,952,244 9.82
6 Uninor 42,113,683 6.27
7 Videocon 4,777,021 0.71
8 MTNL 5,123,277 0.76
9 Loop Mobile 3,075,552 0.46
All India 671,948,122 100.00

Source: Cellular Operators Association in India, www.coai.com/statistics.php, accessed September 28, 2012.
Page 15 9B12A065

Exhibit 5

MULTI-USAGE INFORMED ASCENDING BID

Stages Process
First To prequalify on technical feasibility, roll out, and
business plan followed by financial bid as entry
fee.
Second Qualified bidders from the first round to make a
second-round financial bid.
Second-stage bid amount needed to be at least
equal to the “reservation” price. Bidders whose
quote falls below the “reservation price” would
disqualify. Nobody could bid less
than their bid in the first round.
Third Qualified bidders from the second round to
submit their last and final financial bid.
Outcome
The highest financial bid was to be considered as the “reservation price”
for the subsequent rounds. In case of more than four financial bidders,
barring the lowest bidder, all qualify for the next stage. If four or less than
four applicants qualified for the financial bid, then
all should move to the next round of financial bidding.
In case of three or more qualified bidders, the lowest bidder would be out
of the race. In case of two qualified bidders, both would compete at the
third stage. When a single bidder qualifies, there would be no subsequent
bidding, and it would be announced as winner.
Participant with the highest bid wins and is allotted licence and
asked to deposit 20 per cent of the bid, the remaining 80 per cent to be
deposited within 10 days.

Source: TRAI, Consultation Paper on Auction of Spectrum, Paper no 04-2012, March 7, 2012,
www.trai.gov.in/WriteReaddata/ConsultationPaper/Document/consultation%20paper%20spectrum%20of%20, accessed
August 25, 2012

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