Why in the news ?

• The Telecom Commission cleared the recommendations given by the Telecom Regulatory Authority of India (TRAI) to relax the norms pertaining to the maximum quantum of spectrum that can be held by a particular company.

More on news

• The government-appointed inter ministerial group (IMG) had discussed the issue of relaxation in spectrum caps, which was then sent to the DoT for its consideration. The department then asked the TRAI for its views, which came out in November last year.
• TRAI recommended removal of the 50 per cent intra-band cap on spectrum holding by operators in a circle adding that the government should now ensure that an operator does hold more than 50 per cent of all the sub-1GHz band like 700, 800, and 900 MHz put together.
• As per the current regulations, no service provider can have more than 25 per cent of the total spectrum allocated in a circle and 50 per cent in a given band.

Rationale

• According to an official statement, mergers and consolidation, spectrum cap relaxation is absolutely necessary.
• "This will benefit in two ways, it will enable the operators to pool their resources and enable efficiency on their networks, and secondly, earlier, when smaller amounts of spectrum was available, no one could use it and that had dampened the prospects of auction. Now we expect that there will be better response in the auction process", the statement added.
• Almost all mobile companies in the country are going through consolidation at the time. The country’s second and third largest operators — Vodafone and Idea Cellular are in process of merging with each other, Bharti Airtel is also in process of acquiring Telenor’s India business.
• The relaxation of spectrum cap, if approved by the Cabinet, would help these companies go through with the consolidation without having to surrender any spectrum.

Network for Spectrum project

• The Telecom Commission also approved increase in budget for ‘Network for Spectrum’ project, under which a dedicated communications network is being set up for defence forces in lieu of airwaves vacated for civilian use, from Rs. 11,330 crore to Rs. 24,664 crore. This decision would also be sent to Cabinet for approval.
• The Telecom Commision had also approved upgradation of an earlier project to provide 2G mobile services in Andaman and Nicobar islands to 4G mobile services at a cost of Rs. 343 crore, as against the earlier approved Rs. 262 crore.
• It further approved a proposal to provide satellite connectivity to 5,298 gram panchayats, of which about 4,240 GPs are in North East and about 800 GPs are in Jammu and Kashmir, at a cost of Rs. 916 crore for three years.