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Cabinet Approves Auction Of 5G Spectrum, To Be Held In July

Mumbai: The Union Cabinet approved a proposal of the Department of Telecommunications to conduct a spectrum auction through which spectrum will be assigned to successful bidders for providing 5G services to the public and enterprises.

DoT expects that mid and high-band spectrum will be used by Telecom Service Providers (TSPs) to roll out 5G technology-based services which are capable of providing speed and capacity through existing 4G. will be about 10 times higher in comparison.

A total of 72097.85 MHz spectrum with a validity period of 20 years will be auctioned by the end of July 2022. MHz, 1800 MHz, 2100 MHz, 2300 MHz), mid (3300 MHz) and high (26 GHz) frequency bands, a cabinet statement said.

“The spectrum auction will be benefitted from the Telecom Sector Reforms announced in September 2021. The reforms include zero Spectrum Usage Charges (SUC) on the spectrum acquired in the upcoming auction, providing significant relief to the service providers in terms of the operating cost of telecom networks. Further, the requirement of submitting a financial bank guarantee equivalent to one annual instalment has also been done away with,” the Cabinet note mentioned.

For the first time, there is no mandatory requirement to make an advance payment by the successful bidders. The payment for spectrum can be made in 20 equal annual instalments to be paid in advance at the beginning of each year. This is expected to significantly reduce the cash flow requirements and bring down the cost of doing business in the sector.

The bidders would be given an option to surrender the spectrum after 10 years with no future liabilities with respect to balance instalments.

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