Record bidding will not hike call rates, says Ravi Shankar Prasad

New Delhi: Telecom minister Ravi Shankar Prasad on Thursday said that the record bidding by telecom operators to bag spectrum will not result in an increase in mobile tariffs.

The minister said that he was seeing a huge campaign that mobile rates will go up.

“The spectrum will be with the operators for 20 years. As per the analysis, the yearly load on telecom operators is going to be about Rs 5,300 crore...And Rs 1.3 paise per minute call,” said Prasad.

The GSM operators association Cellular Operators Association of India (COAI) had on Wednesday raised the possibility that high bidding by the operators to get the spectrum will lead to increase in telecom tariffs in the country.

The telecom operators have collectively put bids of Rs 1.10 lakh crore for 2G and 3G spectrum in the auction which concluded on Wednesday.

An analysis shows that Ideal Cellular bid a maximum of Rs 30,306 crore to buy spectrum in the 900 megahertz (MHz), 1800 MHz and 2,100 MHz bands. Airtel bid Rs 29,130.20 crore in the same bands, which also saw Vodafone commit Rs 29,959.74 crore.

Mukesh Ambani-run Reliance Jio bought spectrum for Rs 10,077.53 crore. However, 11 per cent of its airwaves still remained unsold.

Meanwhile, the payment for spectrum won by companies in the auction is expected to push up the debt on telecom operators to about Rs 3.5 lakh crore thus leading to a significant rise in tariffs, industry body Assocham said.