India's largest spectrum auction raises $9.9 billion, misses target
India's spectrum auction ended yesterday, with the government raising $9.9 billion, out of the $84 billion-worth of spectrum put up for sale. The sale proceeds fell short tremendously, with just about 41% of the airwaves on auction being sold. The premium 700 MHz and 900 MHz bands saw no takers during the auction, resulting in lower gains as these bands were the most expensive.
What is fiscal deficit?
A fiscal deficit happens when a country sees its total expenditures exceed the total revenue that it gained during a specific financial year. It is usually expressed in terms of a percentage of the nation's gross domestic product (GDP).
2016: India's biggest spectrum auction
Last week, India's biggest telecom spectrum auction kicked off with almost 2300 MHz of airwaves pitched for sale. The auction saw the exclusive 700 MHz band being put for sale for the first time, although starting at very high prices. The telecom players who participated in the auction were Vodafone India, Bharti Airtel, Jio, RComm, Idea, Aircel and Tata Telecom.
Spectrum auction bids
After the spectrum auction started last week, Day 1 of the auction clocked bids worth around Rs.53,531 crore; with massive interest across the spectrum for 4G bands. Day 2 saw it advance to Rs.56,872 crore. On the third day, the auction fetched another Rs.4,177 crore and the Day 4 saw the government gain an additional Rs.2,482 crore, pitching the total figure at Rs.63,451 crore.
India's largest spectrum auction raises $9.9 billion, misses target
India's spectrum auction ended yesterday, with the government raising $9.9 billion, out of the $84 billion-worth of spectrum put up for sale. The sale proceeds fell short tremendously, with just about 41% of the airwaves on auction being sold. The premium 700 MHz and 900 MHz bands saw no takers during the auction, resulting in lower gains as these bands were the most expensive.
Spectrum auction gains: Expectations and gains
The government placed spectrum worth a whopping Rs.5.6 lakh crore for sale. Although, when the auction ended, it fell short of funds to meet its fiscal deficit target of 3.5% of GDP. The government now has to raise another Rs.32,000 crore to meet the deficit.
What are the auction numbers?
With the largest spectrum volume being auctioned this year, there was massive demand for spectrum in the 1800 MHz and 2300 MHz bands that handle 4G. Vodafone pumped $3 billion during the auction, while Airtel bought spectrum worth $2.13 billion. Idea injected nearly $1.92 billion and newcomer Jio spent $2.05 billion at the auction. All seven participating telecom players have bought some spectrum.
