The telecom sector has witnessed a slew of policy and regulatory developments during the past year. Some of the most notable among these were the release of the Draft Indian Telecommunication Bill, the National Frequency Allocation Plan, and Wireless Licensing Reforms, 2022.
On the infrastructure front, the Department of Telecommunications (DoT) recently announced amendments to the Right of Way (RoW) Rules, 2016, to expedite the roll-out of optical fibre cable in the country. It has also notified the Indian Telegraph (Infrastructure Safety) Rules, 2022, to protect the existing telecom infrastructure and promote its sharing among various stakeholders.
Meanwhile, the regulatory landscape saw a flurry of activity, with the Telecom Regulatory Authority of India (TRAI) releasing recommendations and consultation papers on several pertinent issues such as spectrum and infrastructure sharing, over-the-top (OTT) communication services, satellite broadband and submarine cable networks.
A look at the key policy and regulatory highlights during the past year in the telecom sector…
Draft Indian Telecommunication Bill, 2022
In September 2022, DoT released the Draft Indian Telecommunications Bill for public consultation, with the aim of restructure the legal and regulatory architecture of the telecom sector. Recently, in August 2023, the union cabinet cleared the bill. The draft policy seeks to simplify the framework for mergers, demergers and acquisitions, as well as other forms of restructuring, by only requiring the licensing authority to be intimated. The bill proposes that spectrum allocation can occur through auction or administrative routes and includes provisions for waiving fees, charges and penalties for companies to protect consumer interests and promote fair competition. It also expands the definition of telecommunication services to include OTT communication services, satellite-based communication, internet and broadband, as well as in-flight and maritime connectivity.
Further, the draft bill suggests that the government can defer payments and convert them into shares, write off amounts, or provide relief in certain circumstances. It also gives the government the power to waive fees, grant exceptions to licensees and allow insolvent licensees to continue operating under certain conditions. In cases of public emergency or national security, the government can restrict or intercept communications and take control of telecommunication services. Moreover, the bill allows for spectrum sharing, trading, leasing and surrender, with penalties for licence violations.
National Frequency Allocation Plan
DoT released the National Frequency Allocation Plan, 2022, a central policy roadmap that defines future spectrum usage by all ministries in the country. The new set of reforms for satellite communication services is aimed at easing procedures and streamlining clearances to expedite the roll-out of satcom services across the country, especially in remote areas. Under the document, nearly 17 GHz of new additional spectrum was released for implementing 5G in all three segments of radio spectrum – below 1 GHz, between 1 and 6 GHz and above 6 GHz. Besides, DoT has delicensed the 865-868 MHz spectrum band for internet of things (IoT)/machine-to-machine (M2M), and 433-434.7 MHz and 9-30 MHz for wireless charging. The delicensed spectrum need not be auctioned and can be allocated administratively. Other reforms include self-certification of antenna deployment, reduction in fees and timeline for National Operations Control Centre process required for setting up satellite network, and exemption of licence fees for M2M/ IoT devices for captive, very small aperture terminal licensees.
Wireless licensing reforms
The government released the Wireless Licensing Reforms, 2022 in October last year. Under these reforms, the government simplified the procedure for Standing Advisory Committee on Radio Frequency Allocation certificate clearance, which is required for installing small cells on street furniture and reduced the processing fee from Rs 1,000 to Rs 100. Under the reforms, the import licence process for telecom equipment has been made online and self-declaration-based clearance has been adopted instead of the earlier scrutiny-based clearance process. Further, the government has formulated the process for applying for licences online through the Gati Shakti Sanchar portal, issued an advisory on the use of wireless jammers to stop illegal activities and delicensed various frequency bands for easy use of devices such as Wi-Fi routers and Bluetooth.
Amendments to RoW Rules
DoT recently announced new amendments to the Indian Telegraph RoW Rules, 2016, and introduced the Indian Telegraph RoW (Amendment) Rules, 2023. The latest amendment allows licensees to set up temporary overground telegraph infrastructure when their existing underground infrastructure is damaged. This will help restore telegraph services on priority. The government has directed that no fees will be charged by the appropriate authority for this set-up.
The amendment also provides a clear definition of “street furniture”, which is expected to facilitate faster roll-outs and more efficient network deployments. Further, the amendment provides licensees the option to submit a single application for multiple sites for the establishment of small cells. The appropriate central authorities should permit the deployment of small cells on their buildings and structures without charging administrative fees. DoT has also revised the schedule for fees, charges and compensation for various activities under the latest amendment.
These amendments are in continuation of the earlier amendment released in August 2022. The previous amendment focused on expediting the deployment of telecom infrastructure for 5G networks, simplifying RoW application procedures for the deployment of small cells, and facilitating the use of street furniture to set up telecom equipment. The new rules also provided a single-window clearance system for all telecom-related RoW applications in the form of the Gati Shakti Sanchar portal.
DoT has notified the Indian Telegraph (Infrastructure Safety) Rules, 2022, to protect telecom infrastructure from damage. The rules lay out the procedure for exercising the legal right to dig or excavate any property. Additionally, DoT amended the scope of infrastructure providers Category-1 (IP-1) registrations. Earlier, the sharing of assets such as dark fibre, RoW, duct space and mobile towers of telecom infrastructure companies was allowed on mutually agreed terms and conditions. As per the amendment, IP-1 registration holders will share such infrastructure with other entities as may be specified by the government.
Provisions under the Union Budget
The government announced multiple provisions for the telecom sector under the Union Budget for 2023. It allocated Rs 1.23 trillion for telecom and postal projects, including Rs 975.79 billion for DoT. The government also allocated Rs 21.58 billion for an OFC-based network for defence services and Rs 7.16 billion for telecom projects in the Northeast. Further, it announced a capital infusion of Rs 529.37 billion for Bharat Sanchar Nigam Limited during the financial year. To enable better value addition in handset manufacturing, the budget proposed to provide relief in customs duty on the import of certain parts and inputs. The 2.5 per cent basic customs duty on camera lens and its inputs/parts for use in the manufacture of mobile phone cameras is removed.
Key regulatory initiatives
On the regulatory front, TRAI released its recommendations on using street furniture for small cells and aerial fibre deployment. The regulator suggested that all central government entities should allocate dedicated spaces in their existing and planned buildings for the installation of digital connectivity infrastructure, including small and macro cells. TRAI also released its recommendations on the ease of doing business in the telecom sector, wherein it proposed a one application-one window system for all inter-ministerial approvals, among several other suggestions. Additionally, TRAI released its recommendations on the regulatory framework for satellite broadband. It recommended a separate pan-Indian permit (outside the ambit of unified licences) for setting up satellite earth station gateways, a critical resource for offering fast broadband-from-space services.
TRAI implemented new rules to curb unwanted calls and messages from unknown numbers with effect from May 1, 2023. The new rules require all telecom operators to use artificial intelligence spam filters for their calls and SMSs. A series of consultation papers were released by TRAI. A key focus was on the regulatory mechanism for OTT communication services, licensing and collaborative frameworks, and selective banning of these services. Another consultation initiated by TRAI was focused on issues related to spectrum sharing and leasing, along with issues relating to infrastructure sharing. Recently, the regulator started the consultation process for the review of quality of service standards for access services and broadband services, as well as on the terms and conditions of public mobile radio trunking service and captive mobile radio trunking service licences.
Among other important initiatives, TRAI initiated discussions on promoting networking and telecom equipment manufacturing in India, putting in place a ratings framework for digital connectivity in buildings and formulating a licensing framework and regulatory mechanism for submarine cable networks.