Auction station: Govt makes Rs 3 lakh cr from coal, spectrum and still counting

After biggest scams the auction process has raised money that exceeds all estimates

GN Bureau | March 10, 2015


#auction   #coal   #spectrum   #power   #piyush goyal  


With Rs 2 lakh crore generated already from just 32 mines out of 204 and nearly Rs 1 lakh crore from spectrum auction, the government has so far earned Rs 3 lakh crore.

On Monday alone, two mines -- Utkal C in Odisha and Lohari in Jharkhand fetched over Rs 11,000 crore.

The auction kitty from sale of coal mines and telecom spectrum has swelled to over Rs three lakh crore — exceeding all estimates including by CAG for value of such resources, which have been at the centre of two major scams in the recent years.

The  auction of just 32 of them have yielded Rs 2.07 lakh crore already and in spectrum, total bids reached Rs 94,000 crore at the end of the fifth day of auction on Monday. The auctions will continue.

Coal Minister Piyush Goyal said that the e-auction of 32 coal blocks, out of 204 cancelled coal blocks, “has already yielded potential e-auction revenues, royalties and upfront payments of Rs 2.07 lakh crores, which is far in excess of CAG loss estimate of Rs 1.86 lakh crore.”

Goyal said that the auctions would result in lower cost of power, while coal-bearing states like Odisha, West Bengal, Jharkhand, Chhattisgarh, Madhya Pradesh and Maharashtra will “earn lakhs of crores of additional revenue”.

The power fuel cost would come down by Rs 96,971 crores, resulting in power tariff savings for consumers, he added.

In five days of the second leg of auction so far, mines have been mostly sold in eastern states to firms like Adani, Hindalco, JSW and Jindal.

With regard to the spectrum auction, the Department of Telecom said that the bidding has taken place in all bands and “a value of approximately Rs 94,000 crore has been committed by bidders in respect of provisionally won spectrum”.

Giant companies like Bharti Airtel and Vodafone are locked in battle of spectrum with Reliance Jio. India is the world’s second-biggest smart phone market.  The auction is the biggest ever sale of 2G and 3G airwaves where government is selling spectrum in four bands: 2,100 megahertz (Mhz), 1,800 MHz, 900 MHz and 800 MHz.

Most of the spectrum put up for auction is at present held by Airtel, Vodafone, Idea Cellular and Reliance Telecom. Their licences are expiring in 2015-16.

The 3G and BWA auction together fetched the government over Rs 1.05 lakh crore in 2010. The government had raked in Rs 62,162 crore from the last spectrum auction held in February 2014.

The Coal Minister has said that the auction will help in lowering power costs for consumers as power fuel cost would come down by Rs 96,971 crore.

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