In an effort to promote smooth business functioning in the telecom sector, the Telecom Regulatory Authority of India (TRAI) is in the process of identifying “bottlenecks, obstacles or hindrances” that are making the telecom business difficult in India.
TRAI is reviewing numerous processes through a consultation paper that reflects on procedures regarding unified license including acquisition and payment of license, compliance with financial, technical and commercial conditions, merger and acquisition policy (M&A), spectrum trading and sharing process, bank guarantees and many more.
The consultation paper titled, “Ease of doing Telecom Business in India” invites all industry stakeholders to provide valuable inputs along with detailed justification and explanation by April 11th, 2017. Upon analyzing the views gathered from such industry experts, TRAI will take additional steps, if required, to simplify the process of doing business in the telecom industry.
TRAI is seeking views from shareholders with respect to the M&A policy that can potentially be of value for the ongoing merger between two of India’s largest telecom operators, namely Idea Cellular and Vodafone India. Currently, Vodafone is India’s second largest telecom operator and Idea is third. With this merger, the combined entity will become India’s largest telecom operator, generating sales of approximately $12 billion.
One of the biggest challenges that this merger is tackling regarding the M&A policy is that no operator is permitted to own over 25% of the total allotted spectrum per circle and 50% per allotted band. Furthermore, the RMS of an operator cannot exceed 50% of the revenue market.
TRAI has requested stakeholders to identify concerns in the existing processes as well as welcomed inputs on other processes that require simplification to ease business activity in the telecom industry.