The government will hold long-awaited auctions for 3G and 4G telecoms licences this April, the finance minister Ishaq Dar said on Friday, a step that could help boost the cash-strapped country''s foreign reserves. A 3G licence will cost $295 million and a 4G licence will cost $210 million, minister Ishaq Dar said. He said the government would be looking for full payment, or a 50 percent payment with the rest to be paid in five equal instalments over five years, with an interest rate of three percent.
Zaheer Abbasi adds: Finance Minister Ishaq Dar on Friday said consultations have been completed with all the stakeholders, including existing telecom operators to proceed with the auction for 3G spectrum to raise $1.5 billion through sale of six licences.
Speaking at a news conference here, Dar said Prime Minister Nawaz Sharif has accorded approval to the final policy directive, submitted to him after consultations with existing players in telecom sector, experts, industry analysts and on top of that consultant.
Dar said the government plans to offer as many as three licences of (3G) spectrum with a base price of $295 million for each licence and two licences of (4G) spectrum with a base price of $210 million each. One licence of 850MHz with a base price of $290 million would also be offered to new entrants as there is a likelihood that new entrants may also participate in the bidding process.
Dar said licences would be issued for a period of 15 years with 50 percent as first instalment and full payment in five equal instalments in five years with an interest rate at Libor plus 3 percent. He said the process would start as per plan from March-end. Dar said to foster competition and give incentives to the new corners, the government has also added a licence for a new entrant.
The auction would ensure rapid availability of high-end and new generation information and communication technologies that would promote connectivity, efficiency and massively reduce cost of doing business. The process would foster competition, and discourage concentration of economic power in one or a couple of the companies in this critical sector.
Dar said the government, Pakistan Telecommunication Authority (PTA) and consultants are very confident that the auction will receive strong support and participation both from the existing and prospective telecom operators. Replying to questions, Dar maintained that the International Monetary Fund has endorsed the Finance Ministry''s view during the second review of the Extended Fund Facility (EFF) that growth is increasing and inflation declining in Pakistan.
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