Telecom industry body GSMA on Tuesday said the reserve price set by the Telecom Commission for the 1800 MHz band in Delhi is 70 percent higher than the reserve prices of the same band in most European auctions in the last three years.
Anne Bouverot, director general, GSMA, in a statement said high spectrum prices will increase debt ratios, reduce the ability of operators to invest and ultimately, higher long-term costs will translate into higher tariffs for consumers.
In fact, telecom operators such as Bharti Airtel, Vodafone India, Idea Cellular, etc. will be forced to buy spectrum at premium rates.
Last week, Telecom Commission recommended 25 percent increase in key circles for the 1800MHz and 900 MHz spectrum bands than the price suggested by the Telecom Regulatory Authority of India (TRAI). However, Indian government is yet to announce the final price of the spectrum which will be auctioned in January 2014.
GSMA has urged the Empowered Group of Ministers to base their final decision regarding spectrum pricing on promoting investment, when they meet in the forthcoming weeks.
“Mobile operators in India have to pay significantly more for spectrum than in other parts of the world even though average revenue per user is significantly lower,” Bouverot added.
A recent GSMA report called Mobile Economy India 2013 said that by 2020, the mobile ecosystem could contribute almost US $400 billion to India’s GDP, create 4.1 million new jobs, and contribute significantly through infrastructure investments (US $9 billion) and public funding (US $34 billion) – if the right polices are in place.
