Prime Minister Manmohan Singh Friday said he was happy that the process to auction third generation (3G) spectrum was on track after the defence ministry agreed to vacate 10 MHz of radio waves held by the armed forces.
"I am happy that the auction of spectrum for 3G and broadband wireless access services will be conducted very shortly," he said at the valedictory function of India Telecom 2009 conference.
"This spectrum will be allocated at a market-determined prices rather than through an administered mechanism," the prime minister told delegates at the conference organised by the Department of Telecommunications and the Federation of Indian Chambers of Commerce.
"This will also make available data services to a wider section of consumers and give a fillip to broadband on wireless, unfettered by last-mile constraints," he added.
The cabinet late Thursday evening approved a Rs.10,000-crore project to build an alternate optic fibre cable network for the armed forces, enabling the defence ministry to vacate spectrum and allow 3G auctions to be held early next year.
The government hopes to raise Rs.35,000 crore from the auctions.
Manmohan Singh also said that India's telecom sector, the "fastest growing" in the world, indicated its future.
"It (the sector) tells us about the future prospects of our economy, of our polity and our society. The future is here. The telecom industry displays characteristics which can give you a glimpse of things to happen in our country."
The prime minister also noted the rapid progress made in the sector in the past decade, and said: "This is exemplified by the achievement last week of the figure of 500 million mobile subscribers. We are today the fastest growing telecom market in the world."
At the same time, he said, one needed to be conscious of the digital divide in the country.
"Our rural tele-density is 20 percent. We must therefore double our rural tele-density in the next three years. It is imperative that we exploit the opportunities offered by mobile telephony for promotion of financial inclusion."