Once applauded as the poster boy of India’s economic reforms and now vilified over the 2G scam, the telecom sector is all set to get a glimpse of new norms aimed at cleaning up and rejuvenating the sector with the unveiling of the Draft New Telecom Policy 2011 in New Delhi on Monday.
With a major thrust on transparency and the investment climate, the New Telecom Policy 2011 (NTP-11) is widely expected to help lure more foreign investors to the country and plug the digital divide.
The draft NTP-11, to be unveiled by Telecom Minister Kapil Sibal, proposes to recognise telecom as an infrastructure sector -- which would entail tax concessions -- so that more investment flows in.
Furthermore, the government is also looking to develop a strong, vibrant, secure telecommunication network, providing seamless coverage, with a special focus on rural and remote areas.
These are some of the major focus areas of the draft New Telecom Policy 2011, a source in-the-know said.
Under the draft plan, the Telecom Ministry is also looking to facilitate nation-wide free roaming, frame an exit policy for operators to surrender licences and set up a Telecom Finance Corporation to facilitate investment in the sector.
According to the source, the draft also contains provisions for inter-circle Mobile Number Portability (MNP), which involves changing an operator while retaining the same phone number in different telecom circles.
According to a section on “financing” in the draft NTP, it has been proposed to create a special purpose Telecom Finance Corporation as a vehicle to mobilise and channelise financing for telecom projects in order to facilitate investment in the sector.
It proposes to include telecom sector projects within the ambit of financing from existing entities such as India Infrastructure Finance Corporation Limited (IIFCL) and also to rationalise taxes and levies affecting the sector to stimulate investment and make services more affordable.
The service providers, particularly those which bagged licences in 2008, have been facing problems in securing finance. The establishment of a dedicated institution would help the players complete network roll-outs within the stipulated time frame.
On the exit policy, the draft NTP proposes to frame appropriate guidelines, different from norms for surrender of licences, to permit the easy exit of unwilling service providers. The telecom ministry has already asked sectoral regulator TRAI for its recommendations on this issue.
According to the draft, the Telecom Ministry is mulling a ’one nation-one licence’ approach on spectrum for telecom services in the draft NTP with a view to increase availability of spectrum and permit sharing of networks by operators.
Sources further said the draft policy calls for delinking spectrum in respect of all future licences and for spectrum to be made available at a price determined through market-related processes.
On January 1 this year, after taking charge of the Telecom Ministry, the post which was vacated due to the resignation of former Telecom Minister A Raja, Mr. Sibal had announced his intent to roll out the NTP-2011, which will replace the existing Telecom Policy-1999 in order to bring about transparency in the sector and provide a level playing field to service providers.