5G spectrum auctions get Union Cabinet nod. Here are five key highlights

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The Union Cabinet has approved the telecom department’s proposal to conduct 5G spectrum auctions in July. A total of 72,097.85 MHz of spectrum with a validity period of 20 years will be put to auction to be held on July 26, 2022. The Department of Telecommunications (DoT) has issued a notice inviting applications for potential bidders in the auction.

Here are five key highlights of the proposed spectrum auctions:

1. The spectrum being auctioned this time is valued at more than Rs 5 lakh crore at the base price as recommended by the Telecom Regulatory Authority of India (TRAI). In the previous auction conducted in March 2021, the government sold the rights to use airwaves to telecom companies for Rs 77,820.81 crore.

2. For the first time, there is no mandatory requirement to make upfront payment by the successful bidders. Payments can be made by winning bidders in 20 equal monthly instalments. In case they opt for upfront payment, a moratorium of two years is offered. This is expected to help companies ease cash flow requirements.

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3. The government has allowed the setting up of private captive networks, where tech companies will be able to acquire spectrum directly from the DoT to set up networks to test and build Industry 4.0 applications such as machine-to-machine communications, the internet of things (IoT), artificial intelligence, etc.

4. As part of the Centre’s relief package for telecom companies announced last year, no spectrum usage charge is being levied on airwaves being put under the hammer in this round of auctions.

5. The bidders will also be given an option to surrender the spectrum after 10 years with no future liabilities with respect to balance instalments, the government said.

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