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PM assures of 3G auction on time
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The auction for third generation (3G) airwaves, which are vital for high-end services such as video conferencing and ultra fast internet on mobiles, will be held shortly, Prime Minister Manmohan Singh said on Friday, dispelling industry concerns that the sale of airwaves would be delayed yet again.

Mr Singh also confirmed that the mobile number portability (MNP), the facility that allows customers to change their operator but retain their mobile number, would be implemented ‘early next year’.

The communications ministry had earlier specified the timeline for the 3G auction and said the bidding process would begin from January 14 onwards, but several telecom companies and even some department of telecom officials had expressed fears about the government’s ability to meet these deadlines. “I am happy that the auction of spectrum for 3G and Broadband Wireless Access (WiMAX) services will be conducted very shortly. In a reform initiative, the government has decided that this spectrum will be allocated at market-determined prices rather than through administered mechanism,” Mr Singh said while addressing a telecom industry event.

Earlier this year, the government had set a base price of Rs 3,500 crore for pan-India 3G spectrum and said that four private operators would be awarded 3G airwaves through an auction process. The government has projected that it would raise about Rs 30,000 crore from the auctions of 3G and WiMAX spectrum combined. Mr Singh acknowledged that mobile customers in India enjoyed the lowest tariffs in the world and said this has ‘been possible due to the country’s regulatory regime which has encouraged competition, and also due to the innovation and enterprise of our private sector.’

The prime minister also highlighted that India was the fastest growing telecom market in the world with the addition of over 12 million subscribers every month during the last year. “These achievements are all the more remarkable as they have come at the time of a global economic slowdown. Now that the slowdown is showing signs of moderating, we can hope and aspire for even faster growth of the telecommunication sector in our country,” he added.

India has about 500 million mobile customers and is projected to have over a billion mobile connections by 2015. But, the country is also confronted with a large and growing digital divide as rural tele-density is only at 20% as compared to over 100% in metros and large cities.

Mr Singh said the industry must go all out to double the rural teledensity while also adding that the lack of access to broadband for the rural population was resulting in a large asymmetry of information and opportunity to them. The Centre is currently implementing a massive broadband project, under which all the 2,50,000 gram panchayats would be provided high-speed broadband connectivity by 2012.

The prime minister also said that ‘slow growth in the telecom manufacturing sector in India was an area of concern’. He remained confident that the decision to allow 100% foreign direct investment (FDI) in the manufacture of telecom equipment would attract potential investors.

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