Ashwini Vaishnaw, minister for communications, electronics & information technology and railways, has confirmed that the government expects to receive the Telecom Regulatory Authority of India’s (TRAI) recommendations for the 5G spectrum auctions by the end of March.
Talking to CNBCTV18, the minister said: “We have already started working on the auction documents…we are on track on what we promised earlier and hopefully, the recommendations should be there in March and we should kick off the process.”
He also spoke about the 5G technology stack, which is similar to the 4G protocol stack, but has some changes.
The minister said: “In case of the 5G stack, which we had promised that we should be able to announce to the country by March-April time frame, excellent progress has been made. The 5G core network is ready, the radio network is ready that will be bolt on to the 4G stack, which has been now tested successfully.”
“That’s a great progress and I’m very satisfied that all of us have delivered to the Prime Minister’s vision of having our own 5G technology stack”, he added.
Vaishnaw also explained the scenario of when a telco decided to convert dues liability into equity. He said: “One of the operators has exercised this option of converting interest amount into government equity.”
“We have received the formal proposal and that is getting processed, which includes appointing professionals to study and come to the right numbers and we move forward in that direction,” he added.
Even though, in this case, the minister did not take any name, earlier this year, a regulatory filing by Vodafone Idea revealed that the debt-ridden firm has decided to convert approximately Rs 16,000 crore in interest dues liability payable to the government into equity, amounting to approximately 35.8 per cent stake in the company.
This will make the government one of the biggest shareholders in the telco, which has been under the burden of that debt—over Rs 1.90 lakh crore.
Additionally, the communication ministry in January this year stated that telecom operators such as Vodafone Idea will not become a public sector undertaking after their interest payable on dues is converted into government equity.
However, during the latest interview, Vaishnaw stated that in case of the ongoing process, assessing the formal proposal for conversion of dues liability into equity, it would take around two-three months.
“This is because of the SEBI regulations and the protection of minority shareholders — all of these have to be taken care of. We definitely need to have a proper agreement between the numbers that we have in our account books and what the company would be having in their account books. All of these have to be thoroughly assessed by the professional,” the minister concluded.
Ahead of 5G Auction
Private telecom companies will be able to bring out 5G mobile services in 2022-23 as a result of the spectrum auctions. But the sector has made an aggressive appeal for lowering spectrum price at a time when the country prepares for the mammoth auction.
For the past few months, all of India’s commercial telecom companies have campaigned for a reduction in the high rates for 5G airwaves. They have requested the government to reduce the base price of the spectrum for the upcoming 5G auction by more than half.
However, according to a government official, the authorities have no intention of lowering the price of 5G spectrum for telecom providers, claimed a recent report.
Additionally, although all operators agree that the reserve price should be reduced, there is a distinct divide on other issues. For example, Reliance Jio wants all of the available spectrum auctioned, while Bharti Airtel and Vodafone Idea have urged that the 526-617 MHz band should not be auctioned in the next sale in the absence of an ecosystem.
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