The Union Government has decided to charge for additional spectrum above 6.2 MHz in addition to the license fees. The magnitude of additional sum would be decided by Telecom Commission, the policy-making arm of the Department of Telecommunications.

The government decided over the additional fees in a recent meeting between Communications Minister A Raja, Prime Minister Manmohan Singh and Finance Minister P Chidambaram. It would affect the telecom companies which holds spectrum above the 6.2 MHz. Bharti Airtel, Vodafone and Idea Cellular are the major companies that have to pay more for additional spectrum. However, new telecom players such as Unitech Wireless, Datacom, Loop Telecom and Swan Telecom are unlikely to be affected by the decision.

It was also decided in the meeting to increase spectrum usage charges up to 8 MHz, to one percent of the annual gross revenue (AGR). The charges above 8 MHz would be 2 per cent of the AGR irrespective of the price slab. Experts believe that the decision of hiking spectrum fees would not accumulate more for state exchequer as the bureaucrats determine charges instead of the market.

The president of Cellular Operators Association of India, TV Ramachandran, condemned the move and said that they are providing services at lowest price in the world but government has increased burden on them by increasing taxes and duties.