35 licences facing cancellation by Mar to get DoT notice

The Telecom Ministry, which has sought a legal opinion on cancellation of some telecom licences for failure to meet roll-out deadlines, today said the process of issuing notices to over 35 licences will be completed by March next year.

"The process of issuing notices to 35 licences for missing out roll-out obligations will be completed by March," Department of Telecom Secretary R Chandrashekhar told reporters on the sidelines of a CII event here.

The Telecom Regulatory Authority of India (Trai) had asked the DoT to impose a penalty and cancel as many as 65 new licences over operators' failure to roll out services within the stipulated timeframe.

On the New Telecom Policy (NTP), Chandrashekhar said the policy is expected to be unveiled in January.

Under the NTP, operators may be allowed to share airwaves and there may be more liberal M&A norms as suggested by the draft released in October. This is expected to provide respite to the crowded Indian telecom market, which has 12-13 players operating in some circles.

The Telecom Ministry has been issuing notices to firms on two issues -- ineligibility to get licences and missing roll-out obligations.

The DoT has already issued 15 notices to new telecom companies out of the 65 recommended by Trai. All of these were among the 122 licences that were identified by Trai with respect to missing roll-out obligations and ineligibility of the operator to get a licence.

The cancellations pertain to licences issued in 2008 by former Telecom Minister A Raja, who was sacked when his ministry was accused of selling licences and spectrum at cheaper rates, allegedly costing the government billions of dollars in revenue.

The DoT has already collected over Rs 300 crore in liquidated damages from various new operators for not rolling out services within the time stipulated as per licence conditions.

According to the conditions, the operators have to cover 10% of district headquarters within a telecom circle within the first year of allotment of spectrum. After expiry of another 52 weeks, after claiming liquidated damages, the licences can be cancelled in case the services are not rolled out as per licence conditions.

A final decision on this issue will be taken by the DoT.