According to a statement, India's cabinet has approved a proposal to auction high-speed fifth generation, or 5G, telecom spectrum for 20 years beginning July 26.
According to the government, 72 GHz of spectrum will be auctioned across the low (600 MHz, 700 MHz, 800 MHz, 900 MHz, 1800 MHz, 2100 MHz, 2300 MHz), mid (3300 MHz), and high (26 GHz) frequency bands.
5G telecom services, which are expected to be available soon, will have ten times the speed and capacity of 4G.
The cabinet has also approved so-called private captive networks, which allow enterprises and technology behemoths to have their own networks for machine-to-machine communications, Internet of Things, and artificial intelligence applications in the automotive, healthcare, agriculture, energy, and other sectors.
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India, which has some of the world's lowest telecom costs, has seen intense competition in the telecom space in recent years, leading to consolidation.
Meanwhile, the government is attempting to develop domestic 5G technology and has incentivized activity in the sector through production-linked incentives for the manufacture of mobile handsets, telecom equipment, and semiconductors, which are expected to aid in the launch of 5G. India will launch 6G services by the end of the decade, according to Prime Minister Narendra Modi.
The companies will benefit from the reforms announced in September 2021, including zero spectrum usage charges, in the upcoming 5G auction. Furthermore, the requirement to submit a financial bank guarantee equal to one annual instalment has been eliminated.
The base prices for spectrum, on the other hand, may be an issue for some operators who had hoped for lower prices.
The cabinet has approved 5G auctions at the reserve prices recommended by India's Telecom Regulatory Authority. In April, TRAI recommended a 39% decrease in the reserve price for the sale of 5G spectrum for mobile services. Some operators proposed a steeper cut.
Successful bidders for the 5G airwaves will not have to pay anything up front. Instead, the government stated that payments for spectrum can be made in 20 equal annual instalments in advance at the start of each year.
Companies can also pay the bid amount in full or in part within 10 days of the final price being announced. Those who choose to pay in 20 equal annual instalments will be charged an interest rate of 7.2 percent, according to the government.
Furthermore, the bidders can surrender the spectrum after 10 years with no future liabilities for balance instalments, according to the document.
On June 15, the Department of Telecom issued a notice inviting applications.
The Telecom Regulatory Authority of India recommended a 39% reduction in the reserve price for the sale of 5G spectrum for mobile services in April.