Telecom stocks gain as govt approves spectrum sharing

Telecom stocks today rose by up to 4 per cent after the government allowed companies to share airwaves in the same band so as to reduce call drops.
Shares of Bharti Airtel surged 4.13 per cent and Idea Cellular gained 2.56 per cent on BSE.
Reliance Communications too jumped 3.52 per cent but later pared the gains as the trade progressed.
In a bid to ease telecom congestion, the government yesterday allowed companies to share airwaves in the same band so as to reduce call drops but did not allow leasing of spectrum.
There was, however, no decision on spectrum trading norms, a prerequisite for consolidation in the sector.

"Fulfilling government's commitment to improve spectral efficiency and quality of service, which is very essential to fulfil the dream of Digital India, the Union Cabinet chaired by the Prime Minister, gave its approval to the guidelines on spectrum sharing, arising from the recommendations of the Telecom Regulatory Authority of India (TRAI)," an official statement said yesterday.

Spectrum sharing would be allowed only where both the licensees are having spectrum in the same band and leasing of spectrum will not be permitted, it said.
At present, telecom operators are allowed to share passive infrastructure like mobile towers only.
With the Cabinet's approval, telcos will be able to share their unused spectrum thereby enhancing network quality and reducing operational costs.