Government reveals draft regulations for telecom license issuance under the latest Act

The Indian government has announced draft rules for the licensing of core telecom services under the Telecommunications Act, 2023. The rules, titled the Telecommunication (Licensing of Core Telecommunication Services) Rules, 2025, are aimed at streamlining operations, encouraging investment and innovation, while tightening oversight on issues of security and compliance.

The Centre has proposed four broad classes of telecom services: core telecom services, niche services, captive services, and broadcasting. Within the core segment, four types of licenses are proposed: unified service license, access service license (both wireless and wireline), internet service license, and long-distance communication license.

The draft rules seek to bring clarity to licensing norms and replace provisions of the colonial-era Telegraph Act of 1885. The government has emphasised that suggestions from industry, consumer groups, and other stakeholders will be considered before finalising the rules. Objections and suggestions have been invited within 30 days.

To qualify for a license, applicants must be incorporated companies under the Companies Act and meet prescribed thresholds for paid-up equity and net worth. Foreign direct investment will be subject to prevailing laws. The recognition of virtual network operators could open up the market to smaller players and spur competition.

The new licensing regime also places an obligation on licensed operators to adhere to national security requirements, including cyber security safeguards, lawful interception, customer verification through KYC norms, and data protection rules. Entities blacklisted for regulatory violations or with outstanding dues will not be eligible unless cleared.

The framework does not allow captive networks meant for industrial and enterprise use to be offered commercially. It is also important to note that the draft rules do not mention any specifics about the HIRE Act, the stock market, or Bajaj Auto.

The Federal Communications Commission (FCC), the government agency, has published the draft rules for licensing nuclear telecommunications services under the Telecommunications Act 2023. Once notified, the new licensing system is expected to shape the next phase of India's telecom growth.

The government has also emphasised the need to ensure continuity of services in emergencies and provide access to law enforcement agencies when required. The draft rules are open for public consultation, and it is hoped that the finalised rules will foster a more competitive and secure telecom industry in India.

Government reveals draft regulations for telecom license issuance under the latest Act