Applicants must be incorporated companies meeting equity and net worth thresholds, while blacklisted entities remain ineligible. Licences will be valid for 20 years, with strict compliance obligations on cybersecurity, lawful interception, KYC norms, and emergency continuity.
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The Centre has unveiled draft rules for licensing of core telecom services under the Telecommunications Act, 2023, marking a major step in overhauling the regulatory framework for India’s communications sector.
According to the notification published in the Gazette of India on September 5, the draft, titled Telecommunication (Licensing of Core Telecommunication Services) Rules, 2025, has been opened for public consultation. Objections and suggestions have been invited within 30 days and can be submitted to the Joint Secretary (Telecom), Ministry of Communications.
Four broad classes of telecom services defined
The rules seek to bring clarity to licensing norms by categorising telecom services into four broad classes: core telecom services, niche services, captive services and broadcasting. Within the core segment, four types of licences are proposed—unified service licence, access service licence (both wireless and wireline), internet service licence, and long-distance communication licence.
The document carries elaborate definitions of services and technologies—ranging from spectrum and carrier services to internet telephony, machine-to-machine communication, virtual network operators and cloud-hosted networks. It also sets down the framework for how these services are to be licensed, regulated and interconnected.
Eligibility criteria, equity/net worth thresholds set
To qualify for a licence, 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, and entities blacklisted for regulatory violations or with outstanding dues will not be eligible unless cleared.
The draft rules propose that licences will initially be valid for 20 years, with provision for renewal. Licensed operators will be under an obligation to adhere to national security requirements, including cyber security safeguards, lawful interception, customer verification through KYC norms, and data protection rules. They must also ensure continuity of services in emergencies and provide access to law enforcement agencies when required.
A key feature is the recognition of virtual network operators, allowing companies to provide telecom services without owning the underlying infrastructure. This, experts say, could open up the market to smaller players and spur competition. The framework also addresses captive networks meant for industrial and enterprise use, but clarifies that these cannot be offered commercially.
New rules replace Telegraph Act of 1885
The draft marks the transition to a modernised licensing regime, replacing provisions of the colonial-era Telegraph Act of 1885. It aims to streamline operations, encourage investment and innovation, while tightening oversight on issues of security and compliance.
The government has emphasised that suggestions from industry, consumer groups and other stakeholders will be considered before finalising the rules. Once notified, the new licensing system is expected to shape the next phase of India’s telecom growth, with implications for service providers, technology firms and consumers alike.
Published on September 8, 2025
