The telecom department has amended telecom licence norms to allow higher spectrum holding by individual mobile operators and facilitate ongoing consolidation in the sector.
The amendment removes limitation on telecom operator of holding more than 50 per cent in a spectrum band above 1,000 megahertz frequency range that are used for transmitting mobile signals.
The new licence norms allows telecom operator to hold up to 35 per cent of total spectrum allocated in a service which was earlier limited to up to 25 per cent.
"The total spectrum held by the resultant entity shall not exceed 35 per cent of the total spectrum assigned for access, by way of auction or otherwise, in the concerned service area," the licence amendment dated May 30, 2018 said.
However, a mobile operator cannot hold more than 50 per cent radiowaves in a service area in premium bands below 1 Ghz - 700 Mhz, 800 Mhz and 900 Mhz band.
The 900 Mhz band was used for providing 2G services when mobile telephony in the country started but now all spectrum bands can be used for 4G services.
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The coverage of mobile signals increases when they are transmitted from a lower frequency bands which also makes spectrum in lower frequency band expensive.
The new norms allow telecom operators to hold two blocks of 3G spectrum that were auctioned in 2010 as result of merger or any other permissible arrangement among the companies.
The move facilitates merger of Idea and Vodafone whose combined holding, as per analysts, was breaching spectrum caps in 900 Mhz band across 5 telecom circles - Maharashtra, Gujarat, Kerala, Haryana and UP West under old rules.
Reliance Jio's purchase of RCom spectrum was also breaching earlier permissible levels.