New players face licence termination if they fail to launch within three years

India’s telecoms minister Andimuthu Raja has reportedly announced that the Department of Telecommunications (DoT) may terminate the mobile licences of those new operators which fail to launch services within the three-year period that was stipulated as part of the licence terms. The minister did confirm that there were no plans to alter the timeframes for launch, but did note, ‘Any departure from the law will amount to cancellation of licences...we will be more vigil.’ Additionally, according to the terms of the licences all operators are required to cover at least 10% of each circle’s district headquarters within the first year of operation; industry estimates suggest it would take at least six months for any cellco to reach this coverage level from launch.
The decision comes amid criticism of the DoT following the sales of stakes in Unitech Wireless and Swan Telecom, both of which have yet to launch services; some observers claim that new players are simply waiting to sell out to larger companies, rather than utilising their licences themselves.