Says allocation will be at market-determined prices.
The uncertainty over the auction of third generation (3G) spectrum seems to be over, with Prime Minister Manmohan Singh today saying that the auction will be conducted shortly.
"I am happy that the auction of spectrum for 3G and broadband wireless services will be conducted shortly. In a reform initiative, the government has decided that this spectrum will be allocated at market-determined prices rather than administered one," the Prime Minister said, while addressing the 'Telecom India 2009' conference organised by industry chamber Ficci.
The Department of Telecommunications (DoT) has fixed the auction on January 14 next year. However, there have been differences between DoT and the defence ministry over vacation of spectrum.
Commenting on the introduction of mobile number portability (MNP) in India, Singh said MNP — which will start early next year — will give more choice to customers, enabling them to change their operator while retaining the cellphone number, besides encouraging telecom companies to improve the quality of their service.
India, with a subscriber base of about 500 million and a monthly addition of over 12 million users, can see a faster growth rate in the telecom sector with the global economic downturn showing signs of moderation, he said, adding the tariffs in the country are among the lowest in the world.
The government has also decided to implement a massive programme to increase the use of broadband internet, wherein all 250,000 gram panchayats in the country will be provided high-speed broadband connectivity by 2012. The access to broadband in rural areas is expected to have multiple and long-term positive effects.
"Our rural teledensity stands at 20 per cent, compared with over 100 per cent in towns and cities. We must double our rural teledensity in the next three years," the Prime Minister said.
"While production and export of telecom equipment in the country has shown some growth last year, there is scope for improvement," he added.
Telecom Minister A Raja called upon the telecom industry to cut SMS rates on the lines of voice telephony, saying some of the operators have already done this but it needs to be done on a larger scale.
He said the Universal Service Obligation Fund rules will be amended to make it more investor-friendly for sharing of infrastructure in rural areas.