Telecom Politics

Regulatory Reforms

The third phase of the reforms began with NTP99 replacing NTP94 taking into account technological developments and to tackle the implementation issues faced during the NTP94. Some of the objectives of NTP99 were to (Department of Telecommunications [DOT], 2002)

• “Make available affordable and effective communication facilities to citizens”

• “Increase the teledensity to 7 by 2005 and 15 by 2010”

• “Improve teledensity in villages from 0.4 per thousand to 4 in 2010”

• “Achieve efficiency and transparency in spectrum management”

• “Enable Indian telecom players to become truly global players”

• “Strengthen R&D efforts in the country and provide an impetus to build world class manufacturing facilities in the country”

In order to achieve these objectives, the following provisions were made (DOT, 2002)

• Licence fee to be paid as a percentage of revenue share

• Basic and cellular operators permitted to set up their own long distance services in the licensed service area

• Limited mobility (wireless in the local loop) for basic telephony services allowed

• 49% foreign equity allowed in mobile telephony (this presently stands at 74%)

However, rapid growth in telecom sector required flexibility in controls, easy access to authorities and quicker response from the Government. It was thus found important to separate the regulatory arm from the service arm. To meet this objective, Government initiated corporatization