Telecom regulator TRAI has recommended cancelling 69 telecom licences, the government said on Friday, confirming earlier media reports in a case running parallel to an investigation into one of the biggest corruption scandals to hit India this year.
Telecom Regulatory Authority of India (TRAI) has recommended cancelling 38 licenses of companies including the Indian joint ventures of Telenor, Sistema and Etisalat's for failing to meet network rollout requirements, the government said.
TRAI also recommended cancelling 31 other licences "after legal examination," minister of state for communications & information technology Sachin Pilot said in a written reply to a question from a lawmaker.
The TRAI's recommendations are not binding, but the telecoms ministry has said it would send notices to companies that have been named by the regulator, asking them to defend their licences.
The ministry is also sending notices to companies involved in a telecom scam in which firms were allegedly given telecom licenses and spectrum at rock bottom prices, possibly costing the state $39 billion in revenue. Many of those companies are accused of being ineligible for the licenses.
The case, which revolves around the sale of telecom licenses at low prices, has led to the resignation of A Raja, and, according to an official audit, has possibly lost the state $39 billion in revenue.
It has also frozen Parliament for nearly a month as opposition parties have demanded a full parliamentary investigation.
The government has decided to set up a one-man committee of former Supreme Court judge Shivaraj Patil to examine the allocation of licences and spectrum from 2001 to 2009, telecom minister Kapil Sibal said on Thursday.
A government auditor said in its recent report that licences were given too cheaply and 85 licence holders were ineligible to get them as they had suppressed facts and submitted false documents.
Sibal said on Thursday his ministry would send notices to all the companies by the end of this week, asking them to explain why their licences should not be cancelled.
He had earlier said there were 119 licensees who have not met rollout requirements.
Telecoms licensees in India are required to cover 90% of the service area in metro cities and 10% of the main town in other parts within the first year.
The cancellation recommendations include 10 licenses held by Sistema Shyam Teleservices, eight of Telenor's India joint venture called Uninor, 14 of Loop Telecom, four of Aircel and two of Etisalat DB Telecom.
The 31 licences which the regulator wants cancelled after a legal examination include 13 held by Etisalat DB, 10 of Videocon Telecommunications, six of Loop Telecom and one each of Aircel and Sistema Shyam.
Last month, a source with direct knowledge had told Reuters that the regulator had recommended cancelling 38 licences for not complying with rollout requirements, and to legally examine 31 other licences which had "just met" them.