India's telecom regulatory framework has evolved through a deliberate institutional design that sought to separate policy formulation from regulatory oversight. This approach, rooted in both judicial recognition and global best practices, led to the establishment of the Telecom Regulatory Authority of India as an independent statutory body tasked with ensuring fair competition, consumer protection, and orderly sectoral growth.
Against this institutional background, the importance of regulatory independence becomes central to understanding the current debate. Telecommunications governance rests on a crucial distinction: policy sets the vision, regulation ensures delivery. Governments define the what and why - expanding rural connectivity, deepening digital inclusion, or accelerating 5G adoption- while Regulators determine the how, translating ambition into rules on spectrum allocation, service quality, tariffs, and licensing. But for this framework to work, regulation must be insulated from short-term pressures and competing interests. An independent regulator is therefore not a procedural luxury but an institutional necessity - ensuring fairness, credibility, and investor confidence while safeguarding consumer interests in an increasingly complex digital ecosystem.
This conceptual distinction between policy and regulation has also been recognised in India's constitutional jurisprudence. Even prior to the enactment of the Telecom Regulatory Authority of India Act, 1997, the Supreme Court had underscored the necessity of an independent regulatory framework for managing telecommunications resources. In Secretary, Ministry of Information & Broadcasting v. Cricket Association of Bengal (1995), the Court held that airwaves are public property and must be regulated by an independent public authority in the larger public interest. This principle was further reinforced in Delhi Science Forum & Ors v. Union of India (1996), where the Court emphasised the need for an empowered regulator to ensure fair competition.
India's Liberalisation Vision
When India liberalised its telecom sector in the 1990s, it did so with a visionary goal - to separate policymaking from operations, attract private investment, and safeguard consumer interests through a transparent regulator. The National Telecom Policy of 1994 paved the way for the Telecom Regulatory Authority of India Act, 1997, establishing the regulator as an independent, fair, and statutory body to support orderly sectoral growth alongside protection of consumer interests.
This institutional design reflected a broader global regulatory philosophy that emphasised the separation of governmental policy functions from regulatory oversight.
Global Guidance and Early Institutional Design
The International Telecommunication Union (ITU)'s 1995 Guidelines on Regulation for developing countries had urged the same separation. It advised governments to empower regulators, with control over spectrum licensing, interconnection, competition, and user protection. India's creation of TRAI, although aimed to align with global best practices, but the lack of policymaking and licensing powers confined its role to that of a recommender most of the time.
However, the evolution of India's regulatory framework suggests a gradual divergence from these foundational principles. The Telecommunications Act, 2023, the Draft Telecommunications (Authorisation for Provision of Main Telecommunication Services) Rules, 2025 and the Telecom Regulatory Authority of India (Recruitment and Conditions of Service of Officers and Other Employees) Rules, 2025 indicate a growing concentration of authority within the Central Government across several regulatory domains.
Spectrum Management: Regulator on the Sidelines
Unlike the developed world, where the Regulator has the licensing, spectrum management, setting of standards and penal powers within its domain, the Central Government in India has kept these powers under its control which has decelerated the regulatory position of the Indian Telecom Sector at a much lower pedestal globally.
Under Section 11(1)(a) of the TRAI Act, the role of the regulator has been strictly confined to that of a recommender. Whereas, in the US, the FCC is an independent government agency is directly responsible to Congress. It is a regulator, a policymaker and licensor and hence is directly responsible for the enforcement of its rules and other authorizations. The Spectrum and Competition Policy Division, responsible for formulating and implementing spectrum policies for wireless communications, comes under the Wireless Telecommunications Bureau of the FCC.
The concentration of power has been further reiterated in the Telecommunications Act, 2023 under which the Central Government enjoys full control over Spectrum. Sections 4(1), 5, 6 and 7 of the Act empowers the Government to formulate the National Frequency Allocation Plan from time to time and manage spectrum which is governed by Regulators in many developed economies. Additionally, the Central Government has laid down provisions to enjoy overarching powers under the Draft Telecommunications (Authorisation for Provision of Main Telecommunication Services) Rules 2025 by defining itself as the assigning authority while making the authorised entity liable under the TRAI Act only in case of non-compliance of these rules under Rule 13. Rule 35 of these Rules further places interconnection oversight within the domain of the Central Government, although this function falls within the regulatory domain under Section 11(1)(b)(iii) of the TRAI Act.
Licensing Compliance and Financial Authority
Beyond spectrum, similar patterns emerge in licensing compliance and financial authority. Sections 11(1)(b)(i) and 11(1)(b)(ix) of the Telecom Regulatory Authority of India Act, 1997 empower the regulator to ensure compliance with licence conditions and universal service obligations, yet in practice these powers continue to be exercised by the Central Government.
Furthermore, Section 11, clause (c) of the TRAI Act empowers the regulator to 'levy fees and other charges at such rates and in respect of such services as may be determined by regulation.' However, TRAI has restricted powers to levy fees and since the Regulator is not the Licensing Authority, a major part of revenue generated through licensing accrues to the Licensor- the central government. Although Section 22 of the TRAI Act contains the provision for creation of a TRAI general fund, which has not yet been implemented yet. The Authority is fully funded by the grants from the Consolidated Fund of India that is routed through the DoT.
Financial autonomy is closely linked to institutional independence, and global funding models reflect this principle. In many jurisdictions, licence fees cover administrative costs of regulation, and in the United States fees collected are subsequently allocated back to the Federal Communications Commission as budgetary support.
A comparative look at global regulators underscores how exceptional this shift is:
- In Singapore, the Infocomm Media Development Authority (IMDA) manages and allocates spectrum independently.
- In the U.S., the Federal Communications Commission (FCC) retains exclusive authority over spectrum planning and auctions.
- Ofcom in the U.K. and ARCEP in France exercise similar powers without executive interference.
Even in France, where licences are formally issued by the Government, ARCEP supervises market entry and compliance. Whereas, in India, the Central Government performs all these functions while TRAI exercises either recommendatory role with respect to spectrum assignment or is stifled while regulating the compliance of terms and conditions of license.
India stands alone in allowing the Central Government to both allocate and regulate spectrum which blurs regulatory autonomy and creates ambiguity and unreasonable delay in decision-making on significant regulatory matters.
Quality of Service: Encroachment of Consumer Protection Role of TRAI
Section 11(1)(b)(v) of the TRAI Act empowers the Authority to lay down and enforce Quality of Service (QoS) standards - a cornerstone of consumer protection. Through regulations, TRAI historically monitored call drop rates, interconnection, broadband speeds, and complaint resolution benchmarks.
Yet the Telecommunications Act, 2023 (Section 28) now authorises the Central Government to frame measures for the protection of users. Complementing this, Rule 32 of the Draft on Telecommunications (Authorisation for Provision of Main Telecommunication Services) Rules 2025 allows the State to monitor networks which are statutorily overseen by TRAI.
Similarly, the Notification of TRAI (Recruitment and Conditions of Service of Officers and Other Employees) Rules, 2025 trespass into the subject-matter of appointment which has been regulated by TRAI under section 10(1) of the TRAI Act; this limits induction of suitable technical manpower for specialized requirements.
Such practices are contrary to fair and transparent competition in the sector as the Government is the Licensor and operates two service providers with 100% equity in a PSU and 49% equity in other TSP. One of the main objectives for enacting the TRAI Act was protection of consumer interests and maintain Quality of Services and hence these two functions must independently be carried out by TRAI.
The Penalty Gap and Enforcement Constraints
While global regulators can impose fines or revoke licences directly, India's Section 29 read with Section 34 of the TRAI Act provides only penal powers to the regulator but no power to invoke civil liability against the defaulter. In contrast, regulators such as SEBI exercise wide-ranging and expeditious enforcement powers under the SEBI Act, 1992, underscoring the comparatively limited enforcement capacity of the Telecom Regulatory Authority of India.
This limitation is compounded by the adjudicatory framework under the Telecommunications Act, 2023 which introduces an Adjudicating Officer and internal Appellate Committee despite the existence of TDSAT, creating an unnecessary parallel layer for grievance redressal. Such tiers risk duplication, delays, and executive overreach, undermining regulatory certainty in a sector needing swift and independent dispute resolution.
A Comparative Perspective: The Global Regulatory Divide
Function | India (TRAI) | Singapore (IMDA) | US (FCC) | UK (Ofcom) | France (ARCEP) |
Spectrum | Recommendatory power only | Management and allocation | Management and allocation | Management and allocation | Management and allocation |
Licensing | Recommendatory only | Grants and enforces licences | Grants and enforces licences | Grants and enforces licences | Supervises licensing, ensures compliance |
Quality of Service | Sets standards, enforcement diluted | Sets and enforces standards | Sets and enforces standards | Sets and enforces standards | Sets and enforces standards |
This comparison demonstrates the depth of India's regulatory retreat. Where others strengthened independent oversight, India has merged regulation into administration - an inversion of global norms.
Statutory Coherence and Institutional Overlap
The TRAI Act's Sections 11(1) and 11(2) are non-obstante clauses, giving the regulator an overriding authority. By allowing the Central Government to perform identical functions through subordinate legislation, the 2025 Draft Rules aim to curtail the powers and functions of TRAI thereby invading its autonomy.
Conclusion: Safeguarding Institutional Balance
The Telecommunications Act, 2023, the Draft Telecommunications (Authorisation for Captive Telecommunication Services) Rules, 2025 and TRAI (Recruitment and Conditions of Service of Officers and Other Employees) Rules, 2025 have been formulated to support technological advancement, yet their cumulative effect shifts institutional balance towards greater centralisation.
As India's digital ecosystem expands, the strength of its institutions will determine the pace and credibility of progress. An empowered and clearly mandated regulator is indispensable to fostering innovation, safeguarding consumer interests, and sustaining investor confidence. Reaffirming regulatory independence and clarifying institutional roles will be key to ensuring that telecom governance keeps pace with India's digital ambitions.
Author Note:
Dr. Hansikaa Chauhan is a telecom regulatory and legal consultant practicing before the High Court of Delhi. She holds a PhD in Spectrum Management in Wireless Cellular Mobile Communications in India: Legal Issues and Challenges and has been actively engaged in telecom policy advisory and regulatory compliance. The views expressed are personal.