India Attempts to Give a Jump-start to its Derailed Telecommunications Liberalization Process

Abstract

After the 1991 economic policy made a shift from a closed economic model to a market-oriented model. The government invited private sector to participate in reforming its telecom sector. However, the government took a half-hearted approach in overhauling the legal and regulatory regime, suitable for competitive regime or in framing the 1994 Telecom Policy. Competition was allowed in cellular and basis services. The ministry and the incumbent (DOT) issued licenses to their competitors. Lack of transparency in issuing licenses and unrealistic license fee derailed the reforms process and led to wasteful litigation. The courts did not support the regulator and virtually made its role redundant.