Telecom Commission discusses 100% FDI via auto route

The highest decision making body at the Department of Telecom -- the Telecom Commission -- today discussed the proposal to allow 100 per cent foreign direct investment in the sector through automatic route, a DoT official said.
"The government approved few schemes that are to be supported by Universal Service Obligation Fund," the official said.
Without sharing much details, the official said the proposal to allow 100 per cent FDI in telecom sector through automatic route was part of the agenda at the meeting.
Following the abolition of the Foreign Investment Promotion Board (FIPB), which handled investment in restricted sector, the DoT is working on proposal to allow 100 per cent FDI for telecom services through the automatic route which allows firms to attract foreign funds without its approval.

At present 100 per cent FDI is allowed, of which up to 49 per cent investment in a company can be done through the automatic route. The inflow of overseas investment beyond that requires government approval because of security reasons.
When asked about other major issues like discussion around relief package recommended by the inter-ministerial group, the official said that it could not be discussed adding that the issue may be sent to the Cabinet for final approval in January.

In its September meeting, the Telecom Commission had in- principle approved the extension of time period for the payment of spectrum bought in auctions by telcos to 16 years from the current 10 years, as recommended by the IMG.

It had also approved the IMG recommendation to lower the interest rate charged over penalties imposed on service providers with slight modifications to ease burden on the sector which is reeling under around Rs 4.5-lakh crore debt.
The commission had sought a legal opinion on some of the points it approved at its previous meeting in September-end before firming up its view.
The panel had also sought views of the Telecom Regulatory Authority of India (Trai) on IMG's proposal to relax spectrum cap as it will provide exit path to loss-making mobile service providers and ease consolidation in the sector.

Trai last month recommended that the ceiling on spectrum held by mobile operators within a particular band should be removed, while suggesting a 50 per cent cap on combined radiowave holding in efficient bands like 700 MHz, 800 MHz and 900 MHz.