TRAI calls for limited withdrawal of curbs on M&A in telecom sector

The Telecom Regulatory Authority of India (TRAI) today came out in support of mergers and acquisitions in the sector to a certain extent and called for lifting of curbs on telecom companies to sell out.

Under current Indian laws telecom companies are barred from selling majority stake within three years of procurement of operator licence. According to the regulator the move could help consolidation of the Indian telecom market.

TRAI has also recommended that there should be no auction for 2G spectrum.

According to TRAI, the 2G spectrum price should be linked to 3G spectrum price realised through the auction.

Another suggestion the authority has made concerns linking of 2G spectrum, which it says should be allocated to network rollout and not to subscriber base.

The regulator's recommendations need to be first accepted by the union telecom ministry before they become law.