Home > Telecom > 3G Auction in India: Payment and Other Updates

3G Auction in India: Payment and Other Updates

The much awaited and several times delayed auction for 3G spectrum finally saw dawn in India. The e-auction was conducted between 9 April-19 May 2010. Details on what is 3G was covered by me earlier.

3G is one of the important sources of funding the government expenditure and is expected to curtail the burgeoning fiscal deficit. The overwhelming response to 3G resulted in the total auction price for 22 service areas in India totalling Rs 67,719 crore.

Considering this is huge amount, bankers had geared up to meet the requirements of the telecom companies and consequently credit offtake numbers are expected to show a rise.

The deadline set for the payment of 3G was 31 May 2010. All the companies paid up their dues, as announced by the Department of Telecom in India. 

According to a report in ET on 27 May 2010, the break-up of sources of funds was mentioned. The details are as follows:

  • Loans: Rs 36,000 crore
  • Cash reserves: Rs 29,000 crore
  • Internal accruals: Rs 11,000 crore

A third of the loans that have been raised by telcos are through the issue of commercial papers (i.e. short-term notes issued with a maturity period of one year or less).

Falling realisations (on account of tariff war), huge outflow for 3G and the rising cost of running the existing networks are likely to strain profitability of telecom companies.

Company-wise amount to be paid shows that highest amount of Rs 12,295.46 crore is to be paid by Bharti Airtel Ltd–the largest telecom operator in India.

  • Other company’s details are linked here.
  • Service-area wise successful bidders list is linked for your reference.
Categories: Telecom
  1. No comments yet.
  1. No trackbacks yet.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: