Telephone subscribers across the country will be able to choose service companies soon with the guidelines for the entry of the private sector into basic telecom services throwing open all the circles, including the metros, for private networks. There will be a foreign equity cap of 49 per cent for telecom companies entering the sector. According to the guidelines announced by the Minister for Communications, Mr. Sukh Ram, an autonomous, three-member Telecom Regulatory Authority of India (TRAI) will ensure a level-playing field for the various operators. Mr. Sukh Ram told that only one licence in addition to DoT will be granted for each circle. Long distance telecom networks will not be available for the private sector and the policy will be reviewed after five years. Tenders inviting the private sector to bid for various circles will be floated shortly and the Minister has set December, 1994, as the tentative deadline.

MNCs welcome regulatory body

Telecom multinationals and other Indian companies have welcomed the announcement regarding the formation of a regulatory authority in the telecom sector. Interestingly, no multinational company appeared to be worried about limiting the foreign equity stake to 49 per cent. “These are welcome measures,” the former Telecom Commission Chairman, Mr. N. Vittal, said. Though there was a general skepticism about other entry conditions among the industry, they were unanimous in welcoming the proposal to form the regulatory authority. “We still have to wait for the crucial issues of tariff and revenue sharing before taking a final investment decision,” Mr. Sanjay Kumar of France Telecom, said.

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