India Said to Consider Auctioning Unsold Spectrum in Two Years

India is considering selling its most expensive airwaves in a couple of years after failing to find any bidders in the current auction, government officials said.

The government may lower the minimum price of the spectrum -- specifically in the 700 megahertz and 900 megahertz bands -- to spur demand, the officials said, asking not to be identified because the matter isn’t public. A spokesman at the communications ministry’s Department of Telecommunications declined to comment.

The comments come after the government, which initially planned to raise a record 5.6 trillion rupees ($84 billion), saw only a fraction of that amount in terms of bids after phone carriers balked at the price. While Bharti Airtel Ltd., Vodafone Group Plc’s Indian unit and Reliance Jio Infocomm Ltd. are bidding, most other local operators are passing on the auction as they struggle to cut their debts and stay afloat in one of the world’s most competitive wireless markets.

Lower frequencies are better at passing through walls and traveling longer distances than higher frequencies, allowing carriers to set up fewer cell towers and save costs.

They’re also usually more expensive to get. For example, in New Delhi, a block of spectrum at the lowest frequency was offered at about 80 billion rupees, almost six times the starting bids for the highest frequencies.

Meanwhile, the auction has attracted 635 billion rupees ($9.5 billion) in bids so far, according to a government statement.

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