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Reserve price for telecom auction was too high: Ahluwalia

Reserve price for telecom auction was too high: AhluwaliaNew Delhi, Nov. 21: The Deputy Chairman of the Planning Commission, Montek Singh Ahluwalia, on Wednesday said that the base price of 140 billion rupees at the recent auction of 2G spectrum was set too high.

“I myself had raised the issue that it was a mistake at a level close to the price that was expected to be achieved, and as a result of many discussions, the EGoM actually lowered the reserve price. I want to mention here that one or two newspapers criticised that, as if by lowering the reserve price, we were going to lower the outcome. I had argued very strongly that a healthy auction process will discover the price,” Ahluwalia said.

Ahluwalia also expressed his hope that spectrum left unsold during the recent auction would be sold eventually.

“My personal view on this is, that we should get the auction over and done with, and future policy should be thought out much more clearly. I do not think we should have knee-jerk movements. The auctions are mandated by the court. We have said we will do that, and therefore I assume that we will do it. Of course, I will wait to hear from the department of telecom what their view is,” he said.

The government intends to hold an auction of mobile phone airwaves that were left unsold at a recent sale before March 31 next year, the telecommunications minister, Kapil Sibal, had said during the auction.

Four telecom zones, including the expensive Delhi and Mumbai circles, saw no demand in an auction that ended recently, raising less than a quarter of the government''s 400 billion rupees target.

The government was also left with no bidders in the CDMA (Code Division Multiple Access) part of the auction after Tata Teleservices and Videocon Telecommunications dropped their interest. The decision on the fresh auction will be taken by a panel of ministers, Sibal had told reporters. (ANI)