The proposal for auctioning for phase III of FM channels was given a go ahead by the government on Friday, a process that could add an estimated revenue of over Rs 550 crore to the exchequer.

The Union Cabinet, chaired by Prime Minister Narendra Modi also approved migration (renewal) of private FM Radio licenses from Phase-II to Phase-III in 69 existing cities for 135 channels on payment of migration fee according to Telecom Regulatory Authority of India recommendations.

As of now, with the implementation of two phases of private FM Radio -- Phase I (1999-2000) and Phase II (2005-06) -- there are 243 private FM channels in operation in 86 cities of the country, spanning 26 states and three Union Territories.

"The auction process will add an estimated revenue of over Rs 550 crore to the national exchequer on successful auctions of all proposed channels," an official statement said here.

Besides, it will beget the amount realised through the migration process which is dependent on the TRAI recommended formula, where migration fee is linked with the discovery of market prices through the FM Radio Phase III auction.

The roll out of the first batch of FM Radio Phase III auction will provide more channels to listeners with richer content in 69 existing cities, the statement said.