Union Cabinet Approves Spectrum Auction

Union Cabinet recently approved the spectrum auction for 2024, which is expected to garner Rs 96,317 crore for the exchequer. The auction will include various spectrum bands like 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, and 2300 MHz that can be used by telecom operators to provide 2G, 3G, 4G and 5G services. This move comes at a crucial time when India is preparing for 5G roll-out and the telecom sector is recovering from recent troubles.

What is Spectrum and Why is it Important?

Spectrum refers to the radio frequencies allocated for communication over the airwaves. It is an integral and scarce resource in wireless communication technologies like cordless phones, mobile networks, radio, television, satellite communication etc. With the advent of smartphones and rising data consumption, spectrum has become extremely valuable.

India uses several frequency bands across the electromagnetic spectrum spanning from 300 GHz to 3 kHz. The efficiency of spectrum is critical in determining network quality, speed and capacity. Adequate availability can spur innovations while shortage leads to call drops and unreliable connectivity. Therefore, optimal spectrum allocation and utilization are pivotal for socio-economic progress.

Key Highlights of the Upcoming 2024 Auction

Bands to be Auctioned and Base Price:

Bands (MHz)Base Price (Rs crore)

The auction will offer 72 GHz of radio waves across low (600-900 MHz), mid (1800 MHz, 2100 MHz) and high (2300 MHz, 2500 MHz) bands. Low band spectrum offers wider coverage while high band provides faster speeds over short distances. Mid band strikes the optimal balance between speed and propagation.

The Telecom Regulatory Authority of India has set the reserve price at Rs 96,317 crore, about 15.5% lower than in 2021. Lower reserve prices can attract aggressive bidding from operators.

Allocation for Railways’ “Kavach” Safety System

The Cabinet also approved allotting spectrum worth Rs 25,000 crore to Indian Railways on nominal charges for public safety and security services. The 700 MHz band spectrum will be used to deploy ‘Kavach’ – the indigenously developed Automatic Train Protection system to modernize railway safety.

Kavach aims to prevent train collisions due to human error by ensuring protocols around signals, speeds and track maintenance. It is expected to be implemented across over 68,000 km of the rail network by 2025.

Key Benefits of the Spectrum Auction

For Citizens – Better Quality of Services

More spectrum availability will improve network connectivity, combat call drops and support the rollout of 5G technology with ultra high-speeds and low latency.

It will enable operators to improve services for common Indians at affordable prices. Applications like e-health, online education and smart city solutions can be strengthened.

For Telecom Industry- Business Expansion

The upcoming auction coupled with reforms introduced in 2021-22 will infuse liquidity and stimulate investments in the debt-ridden industry. Telecom operators will be able to expand networks in semi-urban and rural areas and support new technologies like Internet of Things (IoT), machine-to-machine communications.

Modern networks will prepare India to become a digitally empowered economy as envisioned under Digital India. Affordable spectrum prices can attract foreign operators too.

For Government – Revenue Generation

Experts predict the 700 MHz band to see maximum interest from operators due to its premium propagation and penetration characteristics. If sold completely, the auction can fetch around Rs 1.3 to 1.5 lakh crore for the government.

These funds can aid the rollout of BharatNet to connect all villages with high-speed internet. Revenue can also subsidize spectrum charges and license fees to reduce industry levies.


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