2G base price: COAI bats for Rs 1650 cr

NEW DELHI, INDIA: Even as the impasse over 2G spectrum base price continues, Samajwadi Party chief Mulayam Singh Yadav is batting for regulator-determined price for the upcoming auction. Citing the DoT report, Yadav said that there would be no significant impact on consumers.

In a letter to Prime Minister Manmohan Singh, Yadav suggested that Rs.3,622-crore per MHz would have little impact on telcos, while the Cellular Operators Association of India (COAI) maintains that reserve price should be rational.

The EGoM is expected to meet again next week to take a final call on spectrum base price, while on earlier occasion it had deferred decision with apparent pressure from telcos.

Speaking to CIOL, COAI director general Rajan S Mathews said that they have been maintaining that the auction price should be determined through a market-based price mechanism so that a level-playing field is provided and all bidders can have a fair chance in acquiring spectrum.

“The reserve price should not be based on erroneous assumptions and a rational method should be followed in determining it,” Mathews said.

The last market discovered price for spectrum was Rs.1,650 crore (pan-India). Mathews feels that it should be considered and adjusted for inflation and cost of capital, instead.

COAI also believes that the reserve price should be carefully distinguished from the final price as it would be discovered through the auction process, and would be even higher than the reserve price.