Amid the ongoing fight over spectrum allocation norms, Prime Minister Manmohan Singh on Wednesday said it should be allocated in a "transparent and equitable" manner so that it does not create barriers for new players.
He also emphasised that revenue potential to the government must also be kept in mind while making a policy which would enable the continued growth of the telecom sector for years to come.
"It should not create entry barriers to newcomers or barriers to the continued growth of the sector. At the same time, the revenue potential to the government must not lost sight of," Singh said while inaugurating India Telecom 2007, organised jointly by Department of Telecom (DoT) and the Federation of Indian Chambers of Commerce and Industry (FICCI).
The governments across the globe have harnessed substantial revenues while allocating spectrum, Singh said.
Telecom Minister A Raja said the government has already announced its policy to auction the spectrum for next generation 3G mobile services. But on the issue of auctioning of existing 2G spectrum, the minister said the allocation would be considered as per the existing policy.
The prime minister said the government has taken steps for vacation of spectrum by existing users. "I have asked the Group of Ministers tasked with this to expeditiously conclude its deliberations and suggest a road-map regarding availability and timing.
Minister for External Affairs Pranab Mukherjee is heading the GoM and had said yesterday that a decision would be taken soon in this regard.
This is for the first time the prime minister has spoken on the spectrum controversy in which new players have accused the existing operators of blocking their entry.
Lauding the achievements of the DoT and industry for making telecom sector a success story, the prime minister asked the key players to replicate the same in the rural areas.
"Telecom connectivity has the potential to play a transforming role in our rural areas. I expect all key players in this sector to realise and fulfil this potential. You need to rise to the challenge by devising innovative mechanism for achieving our collective ambitions," he said.
He said the teledensity in rural areas was still in the single digits. There will be multiple benefits from increased rural telecom connectivity. At a narrow level, there will be a new burst of growth for the sector. On a larger plane, however, there will be multiplier effects for the entire economy, he said.
He said there was also a need to create an ecosystem for the rapid growth of manufacturing for telecom products.
"It is important both from an economic and a strategic point of view that we are present in the entire telecom value chain. I assure you that the government will develop a forward looking policy regime that will encourage investment in manufacturing in this sector," he said.
The prime minister said healthy competition in this sector has ensured that benefits of scale and technological advancement have been passed on to consumers, allowing the regulator and the government to let a tariff regime of forbearance prevail.
He said we are targeting a growth rate of 10 per cent in the next plan period, which will be sustainable in the medium term given our youthful population and a rising savings rate. However, the major constraints are availability of skilled manpower and high quality infrastructure.
The country needs over $450 billion in the next five years in the infrastructure sector, he added.
The government has set a target of 500 million telephone connections, 40 million Internet and 20 million broadband connections by 2010.