A high-powered ministerial panel has cleared the way for Information and Broadcasting Ministry to conduct auction of FM radio licences in Phase III for 839 channels, which will be completed this year.

“EGoM, on Wednesday, cleared the proposal sent by I&B ministry for some changes in the RFP (Request for Proposal) for auction of FM radio in phase III and we will issue auction guidelines soon,” I&B Secretary Uday Kumar Varma told reporters here on the sidelines of CASBAA India Forum 2013.

An Empowered Group of Ministers (EGoM) on spectrum headed by Finance Minister P Chidambaram had met yesterday on issues related to spectrum auction among other things.

“We should be able to complete the auction of all the 839 radio stations this year,” Mr Varma said.

The clearance will help in setting up of 839 new radio stations in the country and will help the government garner revenues to the tune of Rs 1,500 crore, he added.

The Phase I and Phase II auctions led to total revenue accrual of about Rs 1,733 crore up to May 31, 2011 from one time entry fee, migration fee and annual fee, among others.

In his Budget speech, Mr Chidambaram had said the government proposes to expand private FM radio services to 294 cities.

About 839 new FM radio channels will be auctioned in 2013-14 and after the auction; all cities having a population of more than 100,000 will be covered by private FM radio services.

Presently 86 cities are covered by FM radio stations.

One of the changes proposed by the I&B ministry was a change in the licence fee, which was linked to the percentage of total revenue generated as in the case of telecom licences.

The Ministry said this model should not be followed as the revenues in the case of radio stations are lower.

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