SIMs intended for machine-to-machine (M2M) or internet of things (IoT) communications are typically integrated into devices at the time of manu­facturing to meet physical and environmental standards. These devices, including embedded SIMs (eSIMs), are then deployed in domestic and/or international markets.

Some Indian manufacturers producing such devices for export are requesting permission to incorporate foreign SIMs into their products within India, to enable seamless M2M/IoT service usage outside the country. To this end, they have urged the Department of Telecommunications (DoT) to make a provision under its no-objection certificate (NOC) policy for the sale of foreign operators’ SIMs for M2M/IoT.

According to the industry, the ambit of the current NOC is for the issue/renewal of the NOC for the sale/rent of international roaming SIM cards/global calling cards of foreign operators in India. The cards offered under this policy are limited to use by Indian customers only outside the country. Under the current regulatory framework, foreign SIMs are permitted to be activated in India for only up to 48 hours before a customer’s departure overseas, and must be deactivated within 24 hours of their return. However, in the context of M2M and IoT devices, industry stakeholders have highlighted a need for flexibility. Specifically, they argue that foreign SIMs embedded in export-bound M2M/IoT devices may require temporary activation during the manufacturing stage for purposes such as testing, quality assurance and demonstration. Such limited activation is essential to verify the device’s full functionality before it is shipped to international markets.

To address this, the Telecom Regulatory Authority of India (TRAI) released a consultation paper titled “Regulatory Framework for the Sale of Foreign Telecom Service Provider SIM/eSIM Cards for the Use in M2M/IoT Devices Meant for Export Purposes”. The deadline for submitting feedback was August 1, 2025, with a follow-up for counter comments due by August 18, 2025.

DoT’s prior consultation and stakeholder inputs

DoT had already floated a consultation paper on this specific issue in April 2023, receiving comments from two stakeholders. Stakeholder inputs highlighted diverse views on:

  • Eligibility for the NOC: One stakeholder stated that the NOC should be provided only to entities holding a unified licence or M2M service provider (M2MSP) registration, as the issue of offering communication services, including in-roaming connectivity in India, has security- and consumer data privacy-related concerns. In parallel, the other stakeholder suggested that any individual person or legal entity, incorporated or unincorporated, that is involved in bona fide business activities, should be allowed to apply for the NOC.
  • Activation duration in India for testing: One stakeholder stated that the activation of 23 international profiles could be allowed depending upon the use case and applicable customer process. The other stakeholder suggested that activation could be allowed in India for testing and calibration purposes, and the duration of testing would depend on the nature of testing contemplated, which could be for a maximum period of six months.
  • Custodianship of SIMs: One stakeholder opined that as long as the SIM is in India, the NOC holder should be responsible for ensuring that there is no unauthorised connectivity provided to SIMs. The other stakeholder suggested that the NOC holder should be made the custodian of the foreign SIM.
  • Nature of penalties: One stakeholder highlighted that the NOC only enables the service provider to offer foreign SIMs to devices going out of the country, and imposing a penalty may be disproportionate to the scope of service. The other stakeholder suggested that, instead of punishments, a cooling-off period, or in egregious cases blacklisting, would be more appropriate given the nature of the activities.
  • Who should obtain the NOC: One stakeholder opined that manufacturers desirous of embedding foreign SIMs in their products can obtain the NOC after registering under the M2MSP registration to meet the regulatory requirement. The other stakeholder suggested that both manufacturers and other NOC holders should be permitted to obtain NOC.
  • Allowing IoT SIMs for local use in India: One stakeholder stated that the M2M regulations, as well as custodian requirements mandated for domestic connections, should not be applicable for foreign SIM cards; it also suggested that operating and commercial arrangements for M2M customers should be under forbearance. The other stakeholder argued that IoT SIMs (manufactured abroad) may be allowed to be locally used in India for the purposes of research and development, sale to individual customers for their personal use in IoT-compatible devices, and any other commercial purposes so that the best technology manufacturers can enter the Indian market, and there can be widespread utilisation of IoT technology in all aspects.

Provisions under the Telecommunications Act, 2023, and TRAI’s recommendations

In December 2023, Parliament passed the Telecommunications Act, 2023. Section 3(1) of the Telecommunications Act, 2023 mandates obtaining an authorisation from the central government for providing telecommunication services, establishing/operating telecom networks or possessing radio equipment. The act allows for different terms and conditions for various authorisations, and also provisions for exemptions. Further, the central government, if it determines that it is necessary in the public interest to do so, may provide exemption from the requirement of authorisation, in such manner as may be prescribed.

Consequently, TRAI released its recommendations on the framework for service authorisations to be granted under the Telecommunications Act, 2023 in response to a reference from DoT’s request dated June 21, 2024, to provide the terms and conditions, including fees and charges, for telecommunication service authorisations as per the new act.

TRAI recommended that the government introduce, inter alia, a service authorisation for the sale/rent of international roaming SIM cards/global calling cards of foreign operators in India under the Telecommunications Act, 2023. Notably, it recommended that the terms and conditions of the authorisation for the sale/rent of international roaming SIM cards/global calling cards of foreign operators in India should be light-touch, and the authorisation should be granted online with digitally signed auto-generated authorisation. This authorisation is proposed to be valid for 10 years at a national level. The eligibility criteria include an Indian company with nil minimum equity or net worth, and an application processing fee of Rs 5,000. The cards are primarily for use outside India, with limited activation permitted for 48 hours prior to departure and 24 hours after arrival for test/emergent calls. Strict KYC norms apply, requiring a valid passport, visa (or travel ticket and undertaking for visa-exempt countries), proof of identity and proof of address from users. Monthly reports detailing card sales/rentals must be submitted to designated security agencies.

Key issues highlighted in TRAI’s latest consultation paper

In the reference dated September 17, 2024, DoT mentioned that there are practical difficulties in fitting the use case of the sale of foreign telecom service providers’ SIM/eSIM cards for use in M2M/IoT devices meant for export purposes under the existing NOC policy, particularly with respect to KYC and compliance requirements. It requested TRAI to provide recommendations on the terms and conditions for the issue and renewal of the NOC for the import/sale of foreign telecom service providers’ SIM/eSIM cards for use in M2M/IoT devices meant for export purposes.

TRAI noted that in case it is decided that a new service authorisation under Section 3(1)(a) of the Telecommunications Act, 2023 for the sale of foreign telecom service providers’ SIM/eSIM cards for use in M2M/IoT devices meant for export purposes is required, the terms and conditions of the new service authorisation would need to be firmed up. This would entail working out details such as the eligibility criteria, application processing fees, validity period and renewal conditions, service area and scope, authorisation fees, KYC norms, penalties for non-compliance, permitted duration for in-India activation for testing purposes of a foreign SIM/eSIM, etc.

Alternatively, if the decision is to include the sale of foreign M2M/IoT SIMs for export within the scope of the proposed service authorisation for international roaming SIMs/global calling cards, stakeholders are asked what specific amendments should be made to its terms and conditions: scope of service, eligibility conditions, application processing fees, period of validity and renewal conditions, service area, authorisation fees, and general, commercial and operating conditions.

The paper also seeks inputs on any regulatory issues, including those related to agencies such as the Reserve Bank of India (RBI) and customs, concerning the import of foreign telecom service providers’ SIM/eSIM cards for use in M2M/IoT devices meant for export. It also seeks clarity on any regulatory issues, including those related to agencies like such as RBI and customs, concerning the export of Indian telecom service providers’ M2M SIMs/eSIMs for use in M2M/IoT devices meant for import. Finally, stakeholders are invited to provide comments on any other issues related to the subject matter not covered by the preceding questions.

The way forward

Although the M2M/IoT ecosystem in India is still in its nascent development phase, it shows promise for significant growth and digital transformation in the future, with applications spanning automotive, utilities, healthcare, surveillance, agriculture and more. The government has highlighted the sector’s rising importance through initiatives such as the National Telecom M2M Roadmap (2015) and the National Digital Communication Policy, 2018. According to the updated telecom regulations, M2M/IoT service providers must secure access service authorisation under the unified licence framework to operate in India, and critical services must undergo compulsory testing.

TRAI’s latest move addresses gaps in current regulations, which hamper in-India activation required for testing and prototyping by Indian manufacturers. It aims to streamline compliance and offer support to the growing M2M/IoT ecosystem.

Nikhaar Gogna