The GSMA which represents the interests of mobile operators worldwide has condemned Telecom Commission’s decision to increase the proposed auction prices by the Telecom Regulatory Authority of India (TRAI).

“The GSMA was surprised by the Telecom Commission’s decision to overrule the TRAI recommendations on reduced reserve prices for the 1800MHz and 900MHz spectrum bands” said, Anne Bouverot, Director General, GSMA.

Last week the Telecom Commission proposed to raise the reserved price for 1800 MHz by 15% higher than recommended by TRAI. For 900 megahertz band, it recommended the price 25% more.

In September TRAI had recommended about 60 per cent reduction for the reserve price for spectrum in the 900 megahertz band in some important cities. It also suggested a 37 per cent cut in the reserve price for spectrum in the 1800 megahertz band.

The industry lobby said that given that spectrum blocks remained unsold in previous auctions, we strongly urge the Empowered Group of Ministers to base their final decision regarding spectrum pricing on promoting investment, when they meet in the forthcoming weeks.

It went on to say that mobile operators in India have to pay significantly more for spectrum than in other parts of the world even though average revenue per user is significantly lower.

“For example, the reserve price set by the Telecom Commission for the 1800 MHz band in Delhi is, on average, 70 per cent higher than the reserve prices of the same band in most European auctions in the last three years1. High spectrum prices will increase debt ratios, reduce the ability of operators to invest and ultimately, higher long-term costs will translate into higher tariffs for consumers” it said.

It also urged the Indian government to focus on creating a supportive environment for telecoms investment to continue the success story of mobile in India and ensure that affordable voice and data services are made available to all its citizens.