The Cabinet Wednesday approved a reserve price of Rs.3,705 crore per megahertz (MHz) for third generation (3G) spectrum auction due March 4 next, Communications and IT Minister Ravi Shankar Prasad said.

 

 

 “In 2010 3G auction, the government fixed Rs.700 crore per MHz reserve price and in the auction the then government earned Rs.3,350 crore per MHz, almost 8 times of the reserve price,” he told reporters after a  meeting here of the union cabinet chaired by Prime Minister Narendra Modi.

 

 “The 2100 MHz is a very techno-savvy band for data and video transmission. This time we have fixed a reserve price of Rs.3,705 crore. We have taken the market potential of this band,” he added.

 

 Earlier, the Telecom Commission had suggested a base price of Rs.3,705 crore per MHz for 3G spectrum base price.

 

 The base price suggested by the panel is around 11 percent higher than what telecom companies paid for in the 2010 auction. 

 

 It is also 36 percent higher than Telecom Regulatory Authority of India's recommendation of Rs.2,720 crore per Mhz.