According to Kapil Sibal, Minister of Communications and IT, the government is working towards introducing a liberal merger and acquisition (M&A) policy for the telecom industry. The policy will be aimed at facilitating consolidation in the industry and encouraging investments by players who plan to expand their presence in the country.
Earlier, the government was expected to frame an M&A policy by November 1, 2013. However, the policy is expected to be further delayed as the government is working on second draft of the same.
While reviewing the first draft of the policy, the Department of Telecommunications (DoT) was looking at raising the limit on the market share of a merged entity in a circle from 35 per cent to 50 per cent. The government has also decided to allow a merged entity to hold up to two blocks of 3G and broadband wireless access (BWA) spectrum as against one block being held by the players currently. However, despite opposition from service providers, DoT has stood firm by its decision to charge operators? market price for the additional spectrum that they would get through acquisitions.
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