‘Sensationalism’ killed 2G auction, says govt; another coming by March

The government will conduct another auction before March to find buyers for unsold spectrum after the lacklustre reponse to the auction of 2G airwaves that was wrapped up in just two days.

An Empowered Group of Ministers (EGoM) led by Finance Minister P Chidambaram will meet soon to decide on the price and date for auction of spectrum in circles like Delhi and Mumbai, Telecom Minister Kapil Sibal said Friday.

"There will be an auction before March. There is no doubt about that. What procedure we follow for that auction is something we will decide in another few weeks," Sibal said at a press conference he addressed joinly with Chidambaram.

Sibal blamed "sensationalism" for the muted response to the 2G spectrum auction held earlier this week. "The telecom story is no longer a story that we can talk about to the rest of the world... There was a level of sensationalism that took over and the government was, in a sense, limited in its policy prescriptions and had to move forward in a certain way which ultimately has resulted in what we have seen a couple of days ago," he said.

Sibal challenged the Comptroller and Auditor General's (CAG's) 2010 audit report which said the government could have earned Rs 1.76 lakh crore if the spectrum was auctioned: "Where are those Rs 1 lakh 76 thousand crore? You cannot extrapolate figures and sensationalise them and destroy the hen that laid the golden egg."

"Our point," Sibal said, "always was that market dynamics should be allowed to play out. The moment you start dealing with market directly or indirectly it will be bad".

The consumer, Sibal said, has not benefited because "the nature and the kind of investments that ought to have gone into the sector have stopped and the sector has been in debt".

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