After the Cabinet last month approved spectrum auction rules except spectrum usage charges (SUC) recommended by the inter-ministerial panel Telecom Commission, the Telecom Regulatory Authority of India (Trai) is likely to give its view on annual SUC to the Department of Telecommunications (DoT) this week.
The SUC has been highly debatable issues within the industry, where Trai had recommended SUC at a uniform rate of 3 per cent across the industry and gradually bringing it down to 1 per cent of revenues from telecom services. Before 2010, there was only 2G spectrum and hence the calculation of revenue was easy. But the process became complex after new frequencies were allocated to companies for services like 3G and 4G. The government, in January 2014, decided to cap SUC at a flat 5 per cent for spectrum that was to be procured in the future auctions. At that point, telecom operators were asked to pay the weighted average of their existing SUC (on the old rate of 3-8 per cent) based on the quantum of spectrum they hold and five per cent if they acquire new spectrum.
Meanwhile, the Finance Minister Arun Jaitley had said that the Telecom Commission took the opinion of Attorney General on SUC after recommendation of Trai was received and hence before taking a final call there was need to consult the regulator again. The Telecom Commission had recommended that government should levy 3 per cent SUC on airwaves that will be allocated to companies following the auction.
Spectrum auction was earlier planned by DoT in July, in which airwaves worth Rs 5.66 lakh crore will be put on the block, but with the Cabinet asking for Trai’s view on SUC; it deferred the sale, till September.
Start Research-backed Investing ...Now. Subscribe to Sapphire
MoneyWorks4Me is a SEBI-registered Investment Adviser (IA) dedicated to helping investors build long-term wealth through transparent, research-driven, conflict-free guidance. Founded in 2008, we started our journey as a Research Analyst (RA), providing deep fundamental analysis, intrinsic value insights, and long-term investing frameworks for Indian equities. In 2017, we transitioned to a full-fledged SEBI-registered Investment Adviser, strengthening our commitment to acting as a fiduciary—always putting the investor’s interest first.
To become India’s most trusted, research-powered fiduciary advisory platform—where every investor, regardless of experience, can make calm, confident, and well-reasoned investment decisions.
MoneyWorks4Me ensures this through: