The union cabinet has deferred a decision on the reserve price for the 2G spectrum auction as the Empowered Group of Ministers (EGoM) meeting to discuss the matter was postponed indefinitely.

According to a senior official, the EGoM has been deferred and not new dates have been fixed. The Supreme Court has set a deadline of 31 August for completing the 2G spectrum auction, which is required following scrapping of the 122 licences in February. However, as the key EGOM has been deferred, the decision of the reserve price is unlikely soon. This indicated that the government is likely to miss the deadline for the auction of the 2G spectrum.

Industry regulator, the Telecom Regulatory Authority of India (Trai) had recommended auctioning only five mhz in the 2G auctions. The auctions, which are be held by August as per a Supreme Court order, will be hotly contested by the telecom companies.

TRAI proposal suggests selling only of 5 Mhz spectrum immediately and keeping a huge chunk of the total 1,800 Mhz band for re-farming. The limit placed would introduce a capacity crunch as 7 to 8 telecom service providers are interested in acquiring spectrum.

According to reports, the Prime Minister had asked the finance minister Pranab Mukherjee to decide upon the spectrum price for the auction, however, he has reportedly not agreed to take a call himself and instead decided to defer the meeting indefinitely.