Department of Telecom decides not to increase existing spectrum caps

In a huge blow to telcos that are looking to ensure efficient use of spectrum through spectrum sharing and trading, the Department of Telecom ( DoT) has internally decided to not increase the existing spectrum caps.

The move could be a big dampener for sharing and trading deals as two big telecom players in a circle will not be able to share or trade spectrum.

An internal committee of DoT-set up to look into the issue of spectrum caps-, has submitted its report and made a case for going with the existing spectrum caps.

As per the existing rules, a telecom operator cannot hold more than 25 per cent of total spectrum assigned to all companies in a circle and over 50 per cent of total spectrum assigned in a particular frequency band.

Sector regulator TRAI had also recommended that the present spectrum caps should not be hiked.

Sources say, the committee is of the view that enhancing spectrum caps could mean that large telcos will be able to create a dominant position in the market.

The Telecom Commission- the highest policy making body within the DoT-will take a final decision on the issue, a senior Govt official told ET Now

Experts say trading norms have the potential to usher in the much-needed consolidation in the sector if spectrum caps are relaxed.