India’s satellite spectrum rules: A framework half-built, and now, half-changed

The Department of Telecommunications has released draft rules that, on the surface, appear to finally give India’s satellite communications sector the administrative clarity it has needed for years. The Telecommunications (Spectrum Assignment by Administrative Process) Rules, 2026, establish a codified framework for how spectrum is assigned to satellite operators, what they pay for it, and what security obligations they carry. For a sector that has operated under ad hoc arrangements and legacy licensing conditions for decades, this is meaningful progress.

Then came June 24, 2026.

The DoT notified the Telecommunications (Authorisation for Provision of Principal Telecommunication Services) Rules, 2026, formally completing the demolition of the old licensing regime and replacing it with an authorisation-based framework under the Telecommunications Act, 2023. For the satellite sector and for Indian telecommunications broadly, this is the most structurally significant regulatory event in a generation. The colonial-era Indian Telegraph Act of 1885 is gone. The new architecture is law.

What is not yet clear is whether the transition has resolved the right things.

On the same day the authorisation rules were notified, India quietly removed a proposed 20 percent local sourcing requirement for satellite internet operators, a clause that had required Starlink, Eutelsat OneWeb, Amazon Kuiper and others to source at least one-fifth of the value of their ground-segment equipment from India within five years of launch. The removal was framed as a clarification: “The same has been removed from the final rules as this was creating confusion,” a government official said. But industry sources and former regulators immediately noted what the official did not say, the obligation may still be enforced indirectly, through GMPCS licence agreements and security undertakings, after operators migrate from the old licensing regime to the new authorisation framework.

The difficulty is what the draft does not fully cover. By confining itself to geostationary orbit services and leaving non-geostationary satellite broadband, the most commercially consequential category in the global market right now, outside its scope, the spectrum framework resolves the regulatory status of yesterday’s satellite industry while leaving the rules of tomorrow’s entirely unwritten. The operators preparing to launch low-earth-orbit satellite internet services in India already hold licences and have received approval from the national space regulator. What they still do not have, after years of policy consultation and a formal spectrum pricing recommendation from the sector regulator, is a legal pathway to actually begin commercial service. The draft rules do not change that.

A new operating architecture: Authorisation replaces licensing
Before examining what the spectrum rules do and do not cover, it is necessary to understand the ground beneath them, which has shifted.

The authorisation framework does more than rename licences. It restructures the relationship between the government and telecom operators at a constitutional level. Where licences were bilateral contracts, authorisations are regulatory permissions, meaning that DoT can revise service conditions through rules without renegotiating individual agreements. This gives the government substantially more flexibility to adapt the regulatory environment to new technologies, a feature that, in principle, benefits the satellite sector, which has been hampered precisely by the rigidity of legacy licensing terms.

Existing operators, Jio, Airtel, Vodafone Idea, and satellite service providers, will migrate to the new framework via a phased transition facilitated by a single-window mechanism on the Telecom eServices Portal. The practical implications for satellite operators are significant: their legacy GMPCS and VSAT licences, the instruments that have governed their spectrum rights, security obligations, and commercial permissions, are now scheduled for conversion to authorisations.

What survives that conversion, and what changes, is the central ambiguity that former TRAI principal adviser Satya N. Gupta captured precisely: “The GMPCS agreement between operators and government might govern the same, but it needs to be clarified since the operators will be migrating from the licensing regime to the new authorisation regime.” He was speaking specifically of the local sourcing clause, but his point applies to the entire body of obligations embedded in existing satellite licence agreements. As those agreements migrate, each embedded obligation needs a clear statement of whether it carries over, lapses, or is reconstituted in a new form.

The government has not yet provided that statement.

The local sourcing reversal: Clarity removed, ambiguity created
The 20 percent local sourcing requirement had been one of the most contentious provisions in the proposed rules for satellite internet operators. The rationale was defensible: India has announced significant ambitions in satellite manufacturing under its space privatisation programme, and requiring operators to source ground-segment equipment locally would create demand for a nascent domestic industry.

The practical problem was that India’s satellite equipment manufacturing base does not yet exist at the scale or technical depth to meet the requirement. Starlink, OneWeb, and Kuiper deploy proprietary terminal hardware designed to integrate with their specific constellation architectures. Sourcing 20 percent of ground-segment value from Indian manufacturers, who do not currently produce equivalents, would either require operators to delay launches while domestic manufacturing capabilities were built, or to count ancillary infrastructure as ground-segment value in ways that satisfied the letter but not the intent of the rule.

Removing the clause from the final authorisation rules was, in that sense, pragmatic. But the manner of its removal has created a new problem. The GMPCS licence, which carries an equivalent provision, is the instrument that satellite internet operators currently operate under. When those operators migrate to authorisations, the legal question of whether the local sourcing obligation travels with them, lapses with the old licence, or is superseded by the new rules is unresolved.

This is precisely the kind of ambiguity that deters investment at the margin. An operator planning a multi-year capital commitment needs to know not just whether a rule exists today, but whether an obligation embedded in a legacy licence will be enforced after that licence has been converted to an authorisation. A clean answer, either the obligation carries over and operators should plan accordingly, or it does not and the removal is genuine, is more useful than the current situation, where removal has been announced but enforceability through other instruments remains contested.

What the spectrum rules establish for GSO services
The administrative assignment framework governs how spectrum is allocated to satellite operators who are not subject to a competitive auction, which in practice means the full existing roster of geostationary orbit satellite services. Geostationary satellites occupy fixed positions 35,786 kilometres above the equator and have been the backbone of Indian satellite communications for four decades, serving everything from broadcast television to enterprise data networks to government communications infrastructure.

For these services, the draft rules establish a spectrum fee structure anchored to Adjusted Gross Revenue. The majority of commercial GSO operators, running VSAT networks, teleport facilities, and satellite broadcast services, will pay fees in the range of 3 to 4 percent of AGR. The satellite phone service operated by the state carrier sits in a separate, lower-fee band at 1 percent AGR, reflecting its role as a public-service connectivity option in remote and underserved geographies rather than a commercial proposition.

The AGR-linked fee structure is consistent with how spectrum charges are applied across the rest of the Indian telecommunications sector, and its application to satellite services creates a degree of regulatory consistency that did not previously exist in a formal rule.

VSAT services: Stability, but a changing competitive horizon
VSAT services, which provide satellite-based broadband and private network connectivity to enterprises, banks, hospitals, oil and gas platforms, remote government offices, and rural service delivery infrastructure, are among the largest commercial beneficiaries of the draft’s administrative clarity. India’s VSAT market serves tens of thousands of terminals across geographies where terrestrial fibre has not reached, or where network redundancy demands a satellite backup path.

For incumbent VSAT operators, the rules confirm spectrum access on administrative terms with predictable fee obligations. But the more significant competitive pressure these operators face is the eventual arrival of LEO broadband services that will offer higher throughput, lower latency, and potentially competitive pricing for enterprise customers who currently rely on VSAT.

The draft rules do nothing to accelerate or delay that competitive pressure. What they do is establish the operating terms for the existing market while that pressure builds. And here, the authorisation framework introduces a new dimension: under the notified rules, newly authorised entities will not be permitted to transfer user data outside India. For VSAT operators running hybrid satellite-terrestrial networks for multinational enterprise customers with data architecture that traverses borders, this data localisation mandate introduces compliance implications that deserve careful examination as the transition proceeds.

DTH broadcasting: Administrative continuity in a transforming market
Direct-to-home satellite broadcasting has been one of the most commercially significant geostationary satellite services in India, connecting approximately 70 million households to television content via satellite-delivered signals. For DTH operators and the satellite capacity providers that serve them, the draft rules ensure continuity of spectrum assignment without altering the fundamental commercial or technological pressures the sector faces.

The structural challenge for DTH is not regulatory; it is the accelerating shift in content consumption from linear television to internet-delivered streaming. The administrative spectrum framework does not address this transition. What it does is ensure that existing DTH operations remain on a stable regulatory footing, and under the new authorisation framework, the transition from DTH licences to authorisations introduces the same question of obligation continuity that faces the rest of the sector.

Teleport operations: Infrastructure continuity under stricter security
Teleport facilities, the ground station infrastructure that uplinks content and data to satellite, are governed by the draft rules as part of the GSO administrative assignment framework. But it is the new authorisation rules, not the spectrum rules, that most sharply affect teleport operations.

The notified authorisation rules impose new security requirements that fall with particular weight on teleport infrastructure. Satellite operators must now demonstrate their lawful interception and monitoring systems before they can begin offering services, a provision that requires ground infrastructure to be configured and government-certified before commercial traffic can flow. Fixed satellite service user terminals must be linked to users’ registered premises, with location accuracy maintained within 100 metres. Operators are prohibited from routing Indian user traffic through foreign gateways, either directly or through inter-satellite links, even during domestic gateway failures or network optimisation.

These requirements are technically demanding. The prohibition on routing through foreign gateways, even during domestic failures, removes a standard operational practice that satellite operators use for network resilience. In the event that an Indian gateway fails, the instruction to not reroute through a foreign satellite or ground facility means that Indian user traffic simply goes down, rather than being temporarily maintained through an international path. Whether this is an intended feature of the security architecture or an unexamined consequence of the drafting is not clear from the rules.

Teleport facilities sit at the centre of all of these requirements. They are the physical points where Indian satellite traffic enters and exits the domestic network, and where compliance with foreign gateway routing prohibitions, lawful interception requirements, and security clearance processes must be operationalised. The administrative clarity on security clearance processes will matter for teleport operators as much as for any other segment.

Satellite phone services: Public connectivity at a concessional rate
The state carrier’s global satellite phone service occupies a distinctive position in the spectrum framework. At a 1 percent AGR fee, it is treated as a public-interest connectivity service rather than a commercial operation. The concessional fee treatment is unlikely to be controversial, but it does highlight a regulatory asymmetry that becomes more significant as satellite broadband matures.

The critical gap: Non-geostationary satellite broadband
Everything above describes a framework that works for the existing satellite industry. What the draft does not address is the new one.

Non-geostationary satellite services, specifically fixed satellite services delivered from low Earth orbit and medium Earth orbit constellations, represent the fastest-growing segment of the global satellite industry and the most consequential technology development in satellite communications in a generation. They are not a future technology. They are operational globally, with millions of terminals already deployed in dozens of markets.

In India, multiple operators have completed the licensing steps required for commercial operations. The national space regulator has issued the approvals required by its mandate. There is no spectrum assignment framework, and without it, the final regulatory prerequisite for commercial service delivery remains unmet.

The sectoral regulator had addressed this directly. Its recommendation: a 4 percent AGR charge for non-geostationary fixed satellite services, structured to align with the fee treatment applied to comparable services elsewhere in the telecommunications sector. That recommendation is part of the formal public record. The spectrum draft rules, released after that recommendation, do not incorporate it. They do not reject it either. They simply do not engage with it.

Now, the authorisation rules have added a new layer of complexity to the LEO situation. The rules allow satellite internet operators to use gateways in India to serve other countries, subject to approvals, a provision that opens a path for operators to consolidate ground infrastructure and serve smaller neighbouring countries without setting up local facilities there. This is a commercially useful provision. But it sits in awkward tension with the prohibition on routing Indian user traffic through foreign gateways. The asymmetry, Indian gateways may serve foreign users, but Indian users may not be served through foreign gateways, is a security posture, not a commercial one. LEO broadband operators building their network architecture need to understand exactly how this asymmetry will be interpreted in practice before they can finalise their India infrastructure designs.

The security requirements imposed by the authorisation rules on satellite operators are also new variables in the LEO launch equation. Lawful interception systems must be demonstrated before service begins. User terminals must be location-anchored to within 100 metres. Anti-spoofing detection must be deployed. These are real infrastructure requirements, not paperwork, and they add to the pre-commercial investment and lead time that LEO operators must absorb before they can begin generating revenue.

None of this makes the Indian market unworkable for LEO broadband. But it does mean that the compliance architecture for LEO service in India is now more complex than it was before June 24, and the spectrum assignment framework, the remaining unresolved prerequisite, still does not exist.

Every month of delay is a month in which rural broadband access that satellite technology could provide is not provided, a month in which India’s position in global satellite investment decisions is weighed against markets with cleaner regulatory environments, and a month in which the practical capability gap between what global satellite broadband offers and what Indian regulatory status permits continues to widen.

The new security architecture: Stricter, but not yet tested
The authorisation rules’ security provisions for satellite operators represent a materially more demanding regime than what previously applied. Beyond the requirements already noted, lawful interception demonstration, 100-metre location accuracy, foreign gateway prohibition, operators must deploy systems to detect and report user terminals that conceal their location through hardware or software spoofing tools. The rules also prohibit operators from routing Indian traffic through inter-satellite links in ways that bypass domestic infrastructure.

These requirements have a clear logic in the context of India’s national security posture. Satellite connectivity can, in principle, be used to create communication channels that circumvent domestic monitoring infrastructure. The requirements ensure that authorised satellite operators cannot, intentionally or otherwise, create such channels.

The concern is not the principle but the implementation. The security requirements layer on top of the spectrum assignment gap, creating a situation where LEO operators face detailed pre-launch compliance obligations but still lack the spectrum framework that would make commercial launch legally possible. Compliance investment precedes the commercial permission it is supposed to enable.

For the existing GSO sector, the security requirements are more manageable, these operators have existing infrastructure and long-standing relationships with DoT and security agencies. But even for established operators, the requirement to demonstrate lawful interception and monitoring systems as a condition of continuing authorised service introduces a new verification step that, depending on its administrative processing, could affect service continuity during the licence-to-authorisation transition.

The authorisation rules also mandate that operators deploy AI and big data analytics for fraud prevention and implement anti-spoofing measures for caller line identification. The application of these requirements to satellite operators, whose services include narrowband voice and data services in maritime and remote territories, requires careful implementation guidance that the rules do not currently provide.

Maritime and aviation connectivity: The invisible affected sector
The draft rules’ focus on administrative spectrum assignment for fixed satellite services does not directly address the satellite-based connectivity services used by maritime vessels and commercial aircraft. Maritime satellite communications serve commercial shipping, the offshore energy sector, the coast guard, and the Indian Navy, among other users. Aviation satellite connectivity serves commercial airlines operating domestic and international routes.

Under the new authorisation framework, in-flight connectivity will have a distinct authorisation category, a provision that clarifies the regulatory home for a service that has existed in ambiguous licensing territory. But the operational requirements, particularly the foreign gateway prohibition and the lawful interception mandate, apply to aviation connectivity in ways that need specific guidance. Aircraft traversing Indian airspace while connected to foreign satellite constellations through foreign gateways presents a factual situation the rules’ general prohibition does not neatly address.

These are not edge cases. They are the operating reality of every international flight over India.

Government and strategic users: Security architecture formalised
The security framework in both the spectrum rules and the authorisation rules collectively represents a more formalised security architecture than has previously applied to satellite spectrum administration. For government and defence users of satellite spectrum, who operate under separate arrangements but within the same regulatory environment, the formalisation of this architecture affects the overall governance context.

The practical concern remains administrative efficiency. Security clearance requirements create genuine protective value only if they are substantive rather than procedural, and timely rather than indefinite. The authorisation rules do not specify clearance timelines, which means the commercial and operational implications of security review processes remain dependent on administrative practice rather than regulatory commitment.

Market structure: A two-speed sector with new fault lines
The combined effect of the spectrum draft rules and the authorisation rules is a satellite market with clearly differentiated regulatory tracks, and new fault lines within each.

The geostationary sector operates within a defined, administratively stable framework: spectrum fees codified, assignment processes formalised, and security requirements specified. The path from legacy licence to new authorisation is open, even if transition details need working through.

The non-geostationary sector remains in a pre-commercial regulatory holding pattern. Spectrum fees are unset. The administrative assignment mechanism that would govern LEO spectrum does not exist. The authorisation rules have added new compliance requirements that must be met before launch, without resolving the spectrum question that is the condition for launch.

And within both sectors, the local sourcing question has been nominally resolved in the final authorisation rules, only to resurface as an obligation potentially embedded in GMPCS licence terms that will migrate to the new framework in a manner yet to be defined.

Equipment manufacturers serving the LEO broadband market cannot finalise distribution arrangements or inventory commitments without knowing when commercial service will begin. System integrators working on satellite-terrestrial hybrid connectivity solutions cannot complete their designs. The insurance and financing markets for satellite broadband infrastructure require regulatory clarity before they can price risk.

The commercial ecosystem that a functioning LEO broadband market would generate remains on hold.

India’s satellite sector at a strategic inflection point
The larger context for these rules is India’s declared ambition to become a significant global player in space technology, satellite manufacturing, and satellite communications. The liberalisation of the launch sector, the establishment of the national space regulator, and the creation of pathways for private-sector participation in satellite manufacturing and services collectively represent a strategic posture that recognises satellite capability as critical infrastructure for both the domestic economy and geopolitical positioning.

June 24, 2026 was a significant day for Indian telecommunications. The authorisation framework that replaces 141 years of licensing history is not a minor administrative adjustment. It is a structural change that affects how every telecom operator in India, including satellite operators, relates to the state.

But significance is not the same as completeness. A spectrum framework that resolves the administrative architecture for geostationary services while leaving the policy environment for LEO broadband undetermined is inconsistent with the ambition the authorisation framework represents. And a local sourcing provision that has been removed from rules but may persist through licence agreements in transition does not produce the investment clarity its removal was presumably meant to create.

The authorisation framework provides DoT with something it did not have under the old licensing regime: the flexibility to issue supplementary rules that adapt to new technologies without renegotiating individual licences. That flexibility should be used, promptly, to finalise the NGSO spectrum assignment framework and to clarify the post-migration status of obligations carried in legacy satellite licences.

The 30-day consultation window on the spectrum rules is short. The decisions that consultation needs to inform are not. What happens in the next policy cycle, whether the NGSO framework follows quickly through a supplementary rulemaking, whether the local sourcing ambiguity is resolved with a definitive statement, and whether the security compliance architecture is given implementation timelines that reflect commercial reality, will determine whether India’s satellite communications regulation reflects the sector it has, or the sector it is trying to build.

The authorisation regime is now law. The satellite broadband market that India’s connectivity agenda requires is still waiting for its legal pathway to be established.

The transition from licence to authorisation took effect June 24, 2026. The spectrum framework for non-geostationary satellite services remains outstanding.