Trai paves way for over ₹2 trillion spectrum auction, cuts reserve price

India’s telecom regulator has cleared the way for the next spectrum auction by putting airwaves worth over ₹2 trillion on the block, while recommending steep cuts in reserve prices to improve participation from cash-strained operators. The Telecom Regulatory Authority of India (Trai) has recommended up to a 20-30% reduction in reserve price for the spectrum compared to the previous auction in 2024.

More than 62% or about ₹1.3 trillion worth spectrum is attributed to the 600MHz band, which went unsold in the previous spectrum auctions due to limited device support. The authority has reduced the reserve price for this band by 17% compared to the 2022 auction, and eased payment terms and rollout obligations, underscoring concerns that valuable airwaves have remained idle despite surging data demand.

In spectrum auctions, the reserve price acts as the floor value fixed by the government to ensure that airwaves are not sold below a predetermined minimum benchmark.

In all, vacant airwaves of more than 11,700MHz will be on the block across nine bands—600MHz, 800MHz, 900MHz, 1,800MHz, 2,100MHz, 2,300MHz, 2,500MHz, 26GHz, and 3,300MHz. Further, the auction will also feature ₹17,940-crore new 5G spectrum in the 37-40GHz band, which the regulator had approved in February 2025.

The auction spans low-, mid- and high-frequency spectrum bands—with lower bands such as 600MHz offering wider coverage, mid-bands like 1,800MHz and 3,300MHz supporting balanced 4G and 5G capacity, and high-frequency millimetre wave bands such as 26GHz and 37–40GHz enabling ultra-fast 5G speeds in dense urban areas.

The recommendation from the Trai to the department of telecommunications (DoT) has come at a time when the telecom sector has largely become a duopoly with two players—Reliance Jio and Bharti Airtel—occupying 76.5% of the market share in terms of subscribers.

The third private telecom operator—Vodafone Idea—has been losing subscribers and is struggling to compete owing to its weak financial position.

The DoT will now examine Trai’s recommendations and decide the next date of auctions after taking into consideration the appetite of the operators for a successful auction.

“The spectrum in the frequency bands identified for IMT (international mobile telecommunication) should be auctioned on telecom circle/ metro area basis with a validity period of 20 years,” Trai said in a release, adding that a calibrated reduction in the reserve price can be attempted, in an effort to improve the participation of telecom operators and enhance competitive dynamics to facilitate productive utilization of the idle.

Trai has also recommended that operators participating in auctions will not be able to acquire more than 35% of the total available spectrum, in a bid to ensure competition in the market.

It has also eased terms for deploying the 600MHz band by the telecom operators. “While the spectrum charge may be levied for a period of 20 years, the validity period of the spectrum (in 600Mhz band) should be increased by four years,” Trai said, recommending no rollout obligations for the initial four years for the band.

After paying 5% upfront payment of the bid amount for the 600MHz within 10 calendar days from the government’s intimation, telecom operators will also be given a payment moratorium for four years after which they can make the remaining spectrum payment for the band in 19 installments.

This is different from the payment terms recommended for the older bands in 800MHz, 900MHz, 1,800MHz, 2,100MHz, 2,300MHz, 2,500MHz, 26GHz, 3,300MHz, etc, where two options—full or part upfront payment option, and 20 equal annual instalments option—have been recommended by the regulator.

“Any reduction in reserve price is always welcome and good for both operators and consumers. The government’s objective from the spectrum auction should not be to make money but to charge enough to cover administrative expenses,” said Satya N. Gupta, former principal advisor at Trai.

According to Gupta, the 600MHz spectrum purchase will be a key event to track as the band has been unsold in the previous auction. “A relaxation in payment terms for the band is being proposed with an intent to promote the ecosystem of the band and its usage,” he said.

The 600MHz band is valued for its long-range coverage and strong ability to penetrate buildings, making it particularly useful for rural networks and indoor connectivity. However, it has gone unsold in past auctions mainly due to steep reserve prices and the absence of a mature device and equipment ecosystem in India to support deployments in this band.

The background

In the previous spectrum auction in 2024, 10,522.35MHz of spectrum with a reserve price of ₹96,238.45 crore was put on the block.

Of this, 141.40MHz of airwaves worth ₹11,341 crore were sold. In 2022, before the launch of 5G services, of the 72,098MHz of spectrum worth ₹4.3 trillion offered, operators acquired 51,236MHz of spectrum worth over ₹1.5 trillion.

6GHz not on offer

In line with the demand of big tech companies and Bharti Airtel, the regulator has recommended that the upper 6GHz band (6,425-6,725MHz and 7,025-7,125MHz) should not be put up for sale in the forthcoming auction. To be sure, Reliance Jio wanted the government to bring the band in the upcoming auction but Bharti Airtel did not want the same in absence of device ecosystem and use cases.

“Presently, the IMT ecosystem in the 6GHz band is at a nascent stage and very few countries like China, South Korea, UAE, and Saudi Arabia, have assigned this band for IMT based services. In view of the above, appropriate time for the auction of this band is required to be explored considering the less developed ecosystem and availability of only 400MHz spectrum in a fragmented manner,” Trai said.

The regulator has also asked the telecom department to immediately initiate action for taking back spectrum held with telecom service providers under insolvency, and bring it in the upcoming auction.

This recommendation comes after the Supreme Court on 13 February held that the airwaves cannot be sold under an insolvency process. The ruling dashed banks’ hopes of recovering money lent to bankrupt telecom operators such as Reliance Communications (RCom) and Aircel.

In its recommendations, Trai has also asked the government to consider incentivising the operators to expand their mobile network coverage in areas that have no mobile network coverage and are not covered under the schemes of Digital Bharat Nidhi Fund to bridge the digital divide.

“Once the spectrum auction is concluded, the successful bidders of the spectrum should be permitted to opt for a reduction in the spectrum cost (up to 10% of the auction determined price (ADP). This option should be available for all Licensed Service Areas and for all frequency bands,” Trai said.

It added that for the reduction in the spectrum cost, the operator should deploy new unique tower sites to provide mobile broadband services (using 4G/ 5G technologies) using the spectrum in any of its frequency bands at the locations identified by DoT within a specific period of say one year from the date of identification of such locations.

To invite greater participation in the spectrum auctions for non-telcos, the authority has recommended that the government should set aside some spectrum for Internet Service Providers (ISPs), Machine-to-Machine (M2M) providers and Captive Non-Public Networks (CNPN).

After identification of suitable IMT frequency band(s) to be set aside for ISPs, M2M providers and CNPN, DoT should send a reference to Trai for seeking recommendations on the terms and conditions including reserve price for assignment of such spectrum, it said.

M2M refers to connected devices communicating automatically, while CNPNs are private 4G or 5G networks set up by enterprises for their own internal use.

For new entrants in the upcoming auction especially in Jammu and Kashmir and North East circles the regulator has recommended a reduction in the net-worth requirement from ₹100 crore per Licensed Service Area to ₹50 crore in J&K and from ₹50 crore to ₹25 crore each in North East.