SC extends 2G auction deadline to 31 August

The Supreme Court has issued an order directing the government to conduct 2G spectrum auctions by 31 August and extended the date until which telecom companies with cancelled licenses can operate to 7 September.

On 2 February, the apex court cancelled 122 telecom licences and asked the government to hold a new auction to issue the licences.

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The Supreme Court's decision comes on the heels of the Telecom Regulatory Authority of India releasing its guidelines for the spectrum auctions on Monday. The recommendations set steep reserve prices for the auction, which experts warned, could cripple the telecom sector and deter future investments.The regulator had proposed a pan-India spectrum renewal fee of about Rs 3,600 crore for a 5Mhz block, which is about 8 percent higher than even the pan-India 3G spectrum block.

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The Cellular Operators Association of India (COAI) and the Association of Unified Telecom Service Providers of India (AUSPI) had termed this pricing "arbitrary, regressive and inconsistent" and said it would hinder affordability and rural penetration of telephony.

The extension of the cancellation deadline will be welcome news to incumbents as well as those companies whose licences have been cancelled and are hoping to participate in the auctions.