The Cabinet has cleared spectrum trading guidelines under which telecom operators will be able to sell radiowaves to other service providers. This will help to address the problem of spectrum shortage. As of now only government is allowed to allocate spectrum to telecom firms through auctions. The decision move is expected to increase efficient use of radiowaves by enabling telecom operators, who have a low subscriber base or unutilised spectrum lying with them, to trade in radiowaves.

Telcos will have to inform the government 45 days before the transaction and will have to pay 1% of the transaction amount as trading fee, according to the new guidelines. The regulator had recommended that spectrum trading will not change its original validity period for which it has been allocated to a telecom company. It has also recommended a lock-in period of 2 years on spectrum that a company acquires through auction or trading before it can trade it further.
Telcos are facing pressure from the government to fix the call drop problem, with the latter saying that there is enough spectrum in the country. The new rules are likely to help R-Com continue to operate its network after the company’s right to use spectrum ends. R-Com will see much of its spectrum expiring in the coming years.