Kapil Sibal also told reporters bigger telecoms carriers
such as Bharti Airtel and Vodafone's India unit will be asked to pay
market-linked prices for 2G radio-spectrum beyond 6.2 mega hertz. Such a
pricing mechanism is yet to be finalized.
The government's move is seen as a bid to make the
world's second-largest and fastest-growing market for mobile phone services
more transparent.
The sector was hit by controversy over the awarding of
licences and spectrum in 2007-08, sparking a political row in Asia's
third-largest economy, with the opposition attacking the government for failing
to fight graft.
A state auditor's report that India lost $39 billion in
revenue due to irregularities in the grant of licenses led to the resignation
of then Telecoms Minister Andimuthu Raja.
Sibal, who took over in November after his predecessor
quit, has said the government will announce a new telecoms policy this year,
overhauling decade-old telecoms rules.
Under the present rules, mobile operators pay a total
16.58 billion rupees ($362 million) for licences in all of India's 22 zones and
get 4.4 mega hertz of initial spectrum bundled with the licences without having
to pay any additional price for it.
"We think there needs to be a directional shift away
from the old policy... We are going to delink the licence from the spectrum in
the new dispensation," Sibal told reporters on Saturday.
"Henceforth, spectrum will be awarded, apart from
delinking, on a market-based pricing mechanism," he said, adding the price
of spectrum would be determined either by auction or through some other process
depending on the regulator's proposals.
India last year sold third-generation (3G) mobile radio
spectrum to firms in an auction that saw companies paying nearly $15 billion to
the government, and the state auditor has criticised the government for
awarding 2G spectrum for free.
Companies that were given telecoms licences and 2G
spectrum in 2008 in turn sold stakes in the ventures to international telecoms
firms including Telenor and Etisalat at several times the price they paid for
acquiring licences.
The government has asked five companies — including the
Indian ventures of Telenor and Etisalat — to defend 85 licenses granted in 2008
after the state auditor said the firms were not eligible for the licences they
were given.
The companies are expected to reply to the government
notices by mid-February after which the telecoms ministry will decide whether
to cancel the licences.
Sibal said that if the licenses are held to be valid, the
companies will have to pay for any additional spectrum beyond the 4.4 mega
hertz spectrum already given to them.
Older operators such as Bharti and Vodafone Essar, who
have been in the market for a long time and have received additional 2G radio
spectrum as their subscriber base increased, will also be asked pay for
spectrum beyond 6.2 mega hertz, the upper limit in their licence agreements.
"Anybody who has beyond 6.2, will have to pay market
price, even existing licence holders," Sibal said.
The state auditor had named eight companies including Bharti,
Vodafone Essar, Idea Cellular that were given spectrum beyond 6.2 mega hertz
without having to pay for it.
Separately, the sector regulator Telecom Regulatory
Authority of India last year recommended that firms pay a one-time fee for 2G
spectrum beyond 6.2 mega hertz based on 3G prices, a proposal that drew
protests from the older operators.
The regulator has said it will give fresh proposals on
pricing of 2G mobile spectrum.
Sibal also said companies' annual revenue-sharing with
the government will be uniform under the new policy.
Fifteen mobile carriers in India serve more than 730
million customers and added users at a monthly average of more than 18 million
in 2010.
