Prime Minister Manmohan Singh on Friday cleared the cloud of uncertainty over the auction of 3G licences, saying air waves for starting the third generation telephony service would be sold shortly at market determined prices.
"I am happy that auction of spectrum for 3G and broadband wireless services will be conducted shortly. In a reform initiative, the government has decided that this spectrum will be allocated at market determined prices rather than administered one," he said at a telecom conference.
Auction of 3G spectrum (air waves) is slated to commence on January 14, but has been plagued by differences between Defence and Telecom Ministries over vacation of spectrum for civilian use.
He also predicted that India, which already has nearly 488 million mobile users and adds about 15-16 million users a month, could witness robust growth in the sector given the fact that the economic downturn is showing signs of moderation.
The Prime Minister said the government intends to start the mobile number portability service early next year.
"This would give more choice to customers who would be able to change their operator while retaining their cellular phone number. It would also encourage telecom companies to improve the quality of their service," he said.
He said the government has decided to implement a massive programme of broadband for all, under which all the 2.5 lakh gram panchayats in the country will be provided high speed broadband connectivity by 2012.
The Prime Minister, however, expressed concern over the slow growth in telecom manufacturing in India.
"While production and export of telecom equipment in the country have shown some growth last year, there is scope for improvement," he said.
Telecom Minister A Raja called upon industry to cut down the SMS rates on the lines of voice telephony saying some of the operators have already done it but it needs to be done on a larger scale.
He said the USO Fund rules will be amended to make it more investor friendly for infrastructure sharing in rural areas.