New Delhi, May 31: The cabinet today approved the New Telecom Policy 2012, which aims to do away with roaming charges and let users to retain the same number when they change service providers across the country.

For the telecom industry, the policy envisages a single licence covering all services. The single licence can be at the national, service area or district levels. Under this regime, licences have been delinked from spectrum.

The policy also proposes to boost domestic manufacturing of equipment. However, it does not give any timeframe for implementation.

“The policy seeks to provide a predictable and stable policy regime for a period of about 10 years,” telecom minister Kapil Sibal told reporters after the cabinet meeting.

However, there is no mention of spectrum pricing. Issues related to spectrum pricing and allocation are being looked into separately by an empowered group of ministers headed by finance minister Pranab Mukherjee.

This is the third time a telecom policy has been formulated — the previous ones were in 1994 and 1999.

Analysts said free roaming might have a negative impact on revenues. “This will be negative in the short term for operators as they will lose roaming revenue. However, in the long run, as usage will increase with no roaming charges, it might offset the revenue loss caused to the operators,” said Hemant Joshi, partner, Deloitte Haskins & Sells.

Roaming charges account for nearly 10 per cent of the companies’ revenues.

The new policy is also in favour of liberal use of spectrum, meaning operators can use any spectrum band to provide 2G, 3G or 4G services.

NTP 2012 envisages the reach of telecom services in rural areas to increase to 70 per cent by 2017 and 100 per cent by 2020 from around 39 per cent now.

Under the new policy, broadband speed has been increased to a minimum of 2 megabit per second. This change will come into force with immediate effect.

The minister said policy-making for the telecom sector would continue to vest with the government, adding that the “availability of affordable and effective communication for citizens” is the core goal of the new policy.