India's telecommunications regulator Monday proposed the government should allow all telecom services under one license and charge an entry fee of 150 million rupees ($2.9 million) for a permit covering the whole country, in an effort to simplify the process for companies wanting to enter the sector.
At present, companies need to take separate permits for each of India's 22 telecom service areas and for different offerings such as fixed-line services, basic mobile telephony and Internet.
Apart from the pan-India license, the Telecom Regulatory Authority of India recommended two other levels of licenses -- at service area and district levels -- with a one-time entry fee of 10 million rupees and 1 million rupees, respectively. For the service areas of Jammu and Kashmir and the northeast, which are considered remote, it suggested an entry fee of 5 million rupees.
A service area usually covers a state or a large city.
Apart from the entry fee, operators will need to continue paying a portion of their adjusted gross revenue as annual license fee, it proposed.
In February, the telecom minister said under unified licenses, telecom companies would have to pay 8% of their adjusted gross revenue as fees.
Telecom operators currently pay 6%-10% of their revenue as license fees for basic mobile services, depending on the areas in which they operate.
The proposals will be discussed by the Telecom Commission, the highest decision-making body in the telecom department, which will make a final decision. They are expected to become part of a new telecom policy, which will likely be announced by June.
The new policy comes amid India's drive to clean up the telecom sector following allegations of large-scale rigging in a sale of licenses and bandwidth in 2008, which put the government under pressure. The Supreme Court recently cancelled all the 122 licenses allotted without auctions in 2008.
The regulator has also suggested bringing telecom tower companies under the license regime and proposed that foreign companies be allowed to hold up to a 74% stake in tower firms, as is the case for telecom operators.