The cabinet panel has given the nod to an earlier decision of the empowered group of ministers (EGoM) on spectrum pricing, taken in November.
The Telecom Commission had earlier suggested fixing a minimum Rs.1,765 crore per MHz as the price for pan-India spectrum (22 circles) in the 1,800 MHz band, 15 per cent higher than the Telecom Regulatory Authority of India’s (TRAI) suggested rate of Rs.1,496 crore.
“The reserve price for 1,800 MHz band of Rs.1,765 crore per MHz pan India works out to Rs.8,825 crore,” it said.
The Telecom Commission further suggested to keep the base price for 900 MHz 25 per cent higher than the TRAI recommendation, which the EGoM agreed.
Spectrum in 900 MHz band will cost at least Rs.360 crore per MHz for Delhi, Rs.328 crore for Mumbai and Rs.125 crore for Kolkata.
The government plans to auction these airwaves in the third week of January 2014 and expects to mop up Rs.4,000 crore from the exercise.
The spectrum likely to be auctioned in 2014 is more than 400 MHz of airwaves for commercial use in 1,800 MHz and 45 MHz of airwaves in 900 MHz.
The decisions will result in efficient utilisation of the scarce natural resource of spectrum, facilitating expansion of telecom services in the country, the statement added.