The government has allowed E-Mail operators, cable operators as well as defaulting telecom companies as eligible for obtaining licences for providing internet services. Today's announcement by the minister of state for communications, Kabindra Purkayastha, follows the Prime Minister Atal Bihari Vajpayee declaration last week that new internet licences would be issued beforeNovember 7 to increase the internet proliferation in the country.

The ISPs have been given a free hand to fix their own tariffs to charge the subscriber on the basis of free market forces. However, the Telecom Regulatory Authority of India (TRAI) could review and fix a tariff at any time during the validity of the licence which would be binding on the ISPs.

While the Department of Telecommunications (DoT) has been forced to break the monopoly of its own PSU Videsh Sanchar Nigam Ltd (VSNL) which was a monopoly ISP so far, it has managed to squeeze in some level of discretionary power for itself. After a long tussle, the DoT was forced to allow other agencies like the State Electricity Boards, Railways, Power Grid Corporation Ltd after a tough battle.

However, at a meeting between the PM's task force on information technology and the TRAI, private operators and the DoT it was agreed that ISPs would be allowed to set up their own transmission links, which the latest policy ahs been modified by the DoT to`` provided they are not available from authorised sources and subject to permission of the Authority ( the Director General Telecom or the telecom secretary in this case)''.

The new policy would allow 49 per cent foreign equity for an ISP and prior experience in the field of Information Technology or telecommunication will not be a binding factor in obtaining a new licence. Under the new policy, licences would be issued in three categories - category `A' for all India basis, category `B' for one of the 20 telecom circles and the four metros and category `C' for any secondary switching area of Department of Telecommunications.

Purkayastha said that the DoT was hopeful of signing the first ISP licence under the new policy today itself and added that the department had received 47 applications so far.