TRAI suggests FDI cap of 74% for towercos

15 May 2012

The Telecoms Regulatory Authority of India (TRAI) has suggested lowering the foreign direct investment (FDI) cap for telecom infrastructure providers from 100% to 74%, reports the Business Standard. The comment was made as part of the TRAI’s recommendations on ‘Guidelines for Unified Licence/Class Licence and Migration of Existing Licences’: the reduction is due to come into effect within three years of the implementation of the Unified Licensing regime. The Department of Telecommunications (DoT) has requested that the TRAI reconsider its recommendation, as it believes that the new measures will adversely impact investment in infrastructure. The TRAI, however has said that it expects to increase government income by INR19 billion (USD349.46 million) per year by lowering the FDI threshold to 74%.