The Telecom Commission which is the highest decision-making body of the Communications Ministry also decided to ask the telecom regulator to prescribe a framework for testing of fixed line services.
These two were among the several key recommendations of the regulator that the Telecom Commission today gave its approval to with some changes.
As per the current rules, no mobile service provider can hold more than 25 percent spectrum, vital for transmitting signals, in an area and more than 50 percent in a frequency band.
The Commission is likely to consider raising of Foreign Direct Investment (FDI) limit up to 100 percent for all telecom services including infrastructure through automatic route.
Mobile towers will be installed under the Comprehensive Telecom Development Plan for the North-Eastern Region (NER) which was approved by the Cabinet in September 2014.
The Telecom Commission has asked the Telecom Regulatory Authority of India (TRAI) to review its existing rules to ensure financial stability in the telecom industry. The sector has seen a decline in revenue in the second and third quarters due to Reliance Jio‘s freebies.
Speaking to CNBC-TV18 Naveen Kulkarni of PhillipCapital said that the impact on Idea Cellular will be limited. Idea Cellular doesn't have spectrum in the 2300 MHz band, and hence it will be little impacted, says Kulkarni.
The Telecom Commission has maintained its stance on the proposal of levying spectrum usage charges (SUC), proposing that an additional floor of 3 percent SUC be charged to telecom companies.
Talking about the "constraints" of the regulator due to the terms of reference, Mathews said, "The Cabinet and the Telecom Commission are not so constrained and should move to what Trai sees as the appropriate SUC regime, which is a flat SUC rate, and not a weighted average approach."
To prevent loss of revenue for the government, telecom operators will pay a minimum amount they are paying as per 2015-16 rates.
The Telecom Commission agreed on a 3 percent spectrum usage charge (SUC) for upcoming auctions across bands, while for remaining spectrum bands post 2010, the SUC will be calculated on a weighted average basis. The SUC for 2300 MHz band has been kept at 1 percent.
In what could be the biggest ever sale of telecom airwaves, government will auction 2,000 megahertz of spectrum in the next 2-3 months, Union Minister Ravi Shankar Prasad said on May 20.
Citing a study by Deloitte, the COAI, representing players like Airtel, Vodafone, Idea Cellular, said reducing SUC by 1 percent can increase GDP by about Rs 1.76 lakh crore and reduce number of people below poverty line by 4.7 percent.
The high prices will ensure that there's a very lukewarm response to the upcoming auctions when they do take place, says Rajan Mathews, Director General, COAI.
The committee will undertake discussions on 700 MHz spectrum for which the Telecom Regulatory Authority of India (TRAI) had recommended a price of Rs 11,485 crore per MHz.
According to official sources, the meeting, to be chaired by Telecom Secretary JS Deepak on April 30, will discuss spectrum base price, usage charge and other modalities related to the next round of spectrum auction.
Hailing recent initiatives of the government like spectrum harmonisation and reduction of spectrum usage charges (SUC), Vodafone India today termed these as "progressive steps".
According to sources, the Telecom Commission has agreed to reduce the SUC charge to 3 percent from 5 percent of adjusted gross revenue on spectrum that will be purchased in next round of auction. It will be sent to the Cabinet for final approval.
"The Telecom Commission has agreed to charge SUC (spectrum usage charges) at 3 percent level of adjusted gross revenue on spectrum that will be purchased in next round of auction.
The proposal to have a single number for various emergency services, approved by the inter-ministerial panel Telecom Commission, would be similar to the '911' all-in-one emergency service in the US.
A VNO leases bandwidth from various telecom operators to provide voice and data services to customers.
With this development, the government has moved a step closer to regulating Virtual Network Operator (VNO) - companies that provide telecom services without spectrum.
"Telecom Commission is meeting on March 28. The DoT is expecting Cabinet approval on spectrum price by mid-May and issue notice for auction in June. Taking into account various processes, spectrum auction should begin around July 15," an official source told PTI.
According to the statement, the participation of the NITI Aayog CEO in the meetings of the Telecom Commission will lend value to the deliberations of the Commission because the NITI Aayog has been mandated to serve as a think-tank of the government.
Even in the absence of a spectrum auction in the current fiscal, the Department of Telecom (DoT) is all set to earn a revenue of over Rs 49,000 crore, exceeding the budgeted target by about Rs 6,000 crore.