India drops 20% local sourcing rule for internet satellite operators
The Centre has dropped the proposed 20% local sourcing requirement from final satellite telecom rules. The change eases entry for global satcom operators, though localisation questions remain.
The Centre has removed a proposed requirement that satellite internet companies source at least 20% of their ground equipment from India, offering relief to global operators such as Starlink, Eutelsat OneWeb and Amazon's Project Kuiper as they prepare to roll out commercial satellite broadband services in the country.
The provision, as reported by Mint, included in the draft telecom authorisation rules released last year required operators to procure at least 20% of the value of ground-segment equipment and infrastructure locally within five years of launching commercial operations.
However, the requirement has been omitted from the final telecom authorisation rules notified on Wednesday.
The move comes as India prepares for the entry of global satellite communication players into one of the world's fastest-growing broadband markets.
Despite the removal of the clause from the final rules, industry sources said the localisation requirement may not have been scrapped entirely. Instead, it could continue through Global Mobile Personal Communications by Satellite (GMPCS) licence agreements, security guidelines and undertakings signed by operators with the government.
"The same has been removed from the final rules as this was creating confusion," a government official said, adding that the GMPCS licence agreement already contains provisions related to local sourcing.
The revised rules, however, introduce tighter security norms for satellite communication providers and strengthen the anti-fraud framework applicable to telecom service providers.
These measures are aimed at enhancing network security as satellite-based internet services become an integral part of India's telecom ecosystem.
Experts have welcomed the simplification of the rules but called for greater clarity from the government.
According to officials, as quoted by Mint, operators transitioning from the existing licensing regime to the new authorisation framework need certainty over whether localisation obligations will continue.
The clarification assumes significance as companies including Elon Musk's Starlink, Eutelsat OneWeb and Amazon's Project Kuiper await regulatory approvals and spectrum allocation to begin commercial satellite broadband services in India.
The final implementation of localisation norms could influence future investments, equipment procurement and supply-chain planning for these companies.
The Centre has removed a proposed requirement that satellite internet companies source at least 20% of their ground equipment from India, offering relief to global operators such as Starlink, Eutelsat OneWeb and Amazon's Project Kuiper as they prepare to roll out commercial satellite broadband services in the country.
The provision, as reported by Mint, included in the draft telecom authorisation rules released last year required operators to procure at least 20% of the value of ground-segment equipment and infrastructure locally within five years of launching commercial operations.
However, the requirement has been omitted from the final telecom authorisation rules notified on Wednesday.
The move comes as India prepares for the entry of global satellite communication players into one of the world's fastest-growing broadband markets.
Despite the removal of the clause from the final rules, industry sources said the localisation requirement may not have been scrapped entirely. Instead, it could continue through Global Mobile Personal Communications by Satellite (GMPCS) licence agreements, security guidelines and undertakings signed by operators with the government.
"The same has been removed from the final rules as this was creating confusion," a government official said, adding that the GMPCS licence agreement already contains provisions related to local sourcing.
The revised rules, however, introduce tighter security norms for satellite communication providers and strengthen the anti-fraud framework applicable to telecom service providers.
These measures are aimed at enhancing network security as satellite-based internet services become an integral part of India's telecom ecosystem.
Experts have welcomed the simplification of the rules but called for greater clarity from the government.
According to officials, as quoted by Mint, operators transitioning from the existing licensing regime to the new authorisation framework need certainty over whether localisation obligations will continue.
The clarification assumes significance as companies including Elon Musk's Starlink, Eutelsat OneWeb and Amazon's Project Kuiper await regulatory approvals and spectrum allocation to begin commercial satellite broadband services in India.
The final implementation of localisation norms could influence future investments, equipment procurement and supply-chain planning for these companies.
