/ Foreign Clients · Telecom FDI · Updated 2026-10-15

India telecom sector FDI, 100% automatic post 2024.

India telecom FDI was liberalised to 100% via automatic route in 2021 (replacing earlier 49% automatic + up to 100% via approval). The reform combined with Telecommunications Act 2023, revised Unified Licence framework, PLI for telecom equipment, and 5G rollout creates a transformed landscape for foreign telecom companies. Here's the complete 2026 entry framework.

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Written by CA Durgesh Chavda

Chartered Accountant (ICAI) · Founder, Bharat Quantum Prospera · US incorporation, India-US DTAA, FEMA ODI, NRI taxation, cross-border structuring · LinkedIn

/ The 100% FDI automatic reform

What's now permitted.

Pre-2021: Telecom sector allowed FDI up to 49% via automatic route; 49-100% via Government approval route. Significant delay for majority foreign-owned telecom.
Post 2021 (DoT/MeitY notification): 100% FDI via automatic route for telecom services. No prior approval required.
Reaffirmed by Telecommunications Act 2023: new consolidated telecom law effective 2024; FDI framework carried forward.
Impact: Vodafone recapitalisation, Jio's international partnerships, foreign backbone operators + hyperscalers (AWS, Microsoft, Google) acquiring Indian telecom-adjacent assets, satellite ISP (Starlink, Kuiper) permitted.
Sectoral scope: telecom services (voice, data, SMS), Internet Service Provider (ISP), telecom infrastructure (towers, cables, satellite), telecom equipment manufacturing.

/ Telecommunications Act 2023 - the new framework

What it covers.

Enacted December 2023; effective from 2024. Replaces Indian Telegraph Act 1885 + Indian Wireless Telegraphy Act 1933 + Telegraph Wires (Unlawful Possession) Act 1950.
Unified Licence (UL): single licensing framework covering Access Service, ISP, National Long Distance (NLD), International Long Distance (ILD), Infrastructure Provider (IP-II), Mobile Virtual Network Operator (MVNO), Audio Conferencing, Public Mobile Radio Trunking Service (PMRTS). Entry fee + annual licence fee variable.
Spectrum policy: administrative allocation for strategic/government uses; auction for commercial. 5G spectrum auction 2022; 6G readiness being established.
Right of way: standardised framework for cable laying + tower setting; coordinates with state/municipal RoW rules.
User protection: strict consent-based commercial communication (TRAI DND); privacy integrated with DPDP Act.
Interception + emergency powers: Section 20 permits government interception under specified conditions.
Satellite spectrum: administratively allocated (not auctioned) — distinguishing feature favouring satellite operators.

/ Entry structures for foreign telecom

Three routes.

Route 1: Full telecom operator (ISP + Access Service)

Indian WOS incorporated under Companies Act.
Apply for Unified Licence from Department of Telecommunications (DoT).
Entry fee + Performance Bank Guarantee + Financial Bank Guarantee.
Compliance: lawful interception facility, security compliance (DoT Security Guidelines), CERT-In empanelled audit, DPDP compliance.
Spectrum (if required): auction participation.
Timeline: 12-24 months from incorporation to operational.

Route 2: Infrastructure Provider (IP-II)

Passive infrastructure — towers, dark fibre, dense cities, in-building.
Simpler licensing framework.
No spectrum obligation.
Entity rents infrastructure to telecom operators.

Route 3: Satellite internet / Satcom

DoT satellite ISP licence + IN-SPACe authorisation for satellite operation.
Starlink, OneWeb, Project Kuiper working through this route.
Administrative spectrum allocation (vs auction for terrestrial).
Coordinated with SpaceCom Policy 2023.

/ Compliance stack for foreign telecom

What ongoing.

DoT Security Guidelines: equipment must be from trusted sources (National Security Directive on Telecommunications Sector); specific country / vendor restrictions apply.
Lawful interception: operator must maintain lawful interception facility; co-ordinate with Indian LEAs on security matters.
Subscriber verification: strict Know Your Customer (eKYC via Aadhaar / alternative) + address verification.
Data localisation: subscriber data + traffic data in India per DoT + DPDP + CERT-In requirements. See our data localisation guide.
CERT-In directions: 6-hour breach reporting; audit log retention.
DPDP compliance: subscriber as data principal; consent + rights framework.
Spectrum compliance: periodic payment of annual spectrum charges + rollout obligations.
Licence fee: 8% of Adjusted Gross Revenue (AGR) — the famous AGR concept.
USO (Universal Service Obligation) Fund: 5% of AGR contribution.

Last updated: 2026-10-15.

/ Ready when you are

Foreign telecom / ISP / satellite operator evaluating India?

100% FDI automatic since 2021 + Telecommunications Act 2023 + Unified Licence framework. BQP end-to-end: FDI + licence + security compliance + spectrum + ongoing operations.

Get a firm quote → WhatsApp Durgesh

FAQ

Common questions, answered.

Can a foreign telecom company own 100% of an Indian telecom operator?

Yes - 100% FDI via automatic route since 2021 (reaffirmed by Telecommunications Act 2023). No prior Government approval needed for ownership. However: operational licence (Unified Licence from DoT) + security compliance (Security Guidelines, Lawful Interception) + spectrum (via auction for terrestrial) + DPDP + CERT-In compliance all apply equally to foreign-owned Indian telecom operators.

What is India's Unified Licence (UL)?

Single licensing framework replacing earlier separate licences. Covers Access Service, ISP, NLD, ILD, Infrastructure Provider (IP-II), MVNO, Audio Conferencing, PMRTS. Entry fee + annual Licence Fee (8% of Adjusted Gross Revenue) + Performance Bank Guarantee + Financial Bank Guarantee. Single licence authorises multiple services; chose service authorisations within the UL at application. Simpler than pre-2013 fragmented licensing.

Is foreign satellite internet (Starlink, OneWeb) permitted in India?

Yes - permitted via DoT satellite ISP licence + IN-SPACe authorisation for satellite operation + spectrum (administratively allocated for satellite, vs auction for terrestrial). Starlink + OneWeb + Project Kuiper working through this route. India's 2024 Space FDI reform (100% automatic for components, 74% for operations) + Telecom 100% automatic FDI enables full foreign-owned satellite internet operators.

What's AGR (Adjusted Gross Revenue) in Indian telecom?

Revenue measure on which Licence Fee (8%) + USO contribution (5%) + Spectrum Usage Charge are calculated. Famous for its broad interpretation by Supreme Court (2019 ruling) including non-telecom revenues like interest + capital gains + handset sales - caused massive demands on operators. Legislatively being narrowed over time but remains financially significant for Indian telecom operators.

What are DoT Security Guidelines for foreign telecom equipment?

National Security Directive on Telecommunications Sector (2021 + updates): equipment must be from 'trusted sources'. DoT maintains list of trusted vendors + list of concern countries (effectively restricting equipment from specific country of origin). Foreign-owned Indian telecom operator must comply - affects equipment sourcing decisions. Specific procurement + certification processes.

Does BQP handle India entry for foreign telecom companies?

Yes - specialised telecom advisory. FDI structuring (100% automatic path), Indian subsidiary (WOS) setup, DoT Unified Licence application, Security Guidelines compliance, Lawful Interception setup, DPDP + CERT-In compliance, spectrum auction co-ordination, state-level RoW co-ordination, ongoing AGR + USO + spectrum compliance. Co-ordinated with Indian telecom regulatory counsel. Scope-based engagement. WhatsApp +91 78018 87130.