India's updated telecommunications authorisation rules eliminate the previously proposed mandate for satellite broadband providers to source 20% of their ground-segment equipment domestically but maintain stringent security measures to control satellite data gateways and infrastructure.
- 20% local sourcing rule for satellite ground equipment dropped
- New authorisation framework replaces old telecom licensing regime
- Security controls over satellite gateways and infrastructure remain
What happened
India's government has officially replaced its decades-old telecom licensing system with a new authorisation framework under the Telecommunications Act, 2023. A significant change in this updated regime is the removal of a draft requirement that satellite broadband operators procure at least 20% of their ground-segment equipment domestically within five years of commercial operations. This move concludes regulatory uncertainty over conditions for global satellite companies such as Starlink, Eutelsat OneWeb, and Amazon Leo.
While the local sourcing mandate has been dropped, India’s new rules maintain strict security provisions, including the requirement that all domestic satellite traffic pass through sovereign-controlled gateways. The Centre retains the power to issue directions and suspend or revoke authorisations, emphasizing the intent to protect national security while welcoming international satellite service providers.
Why it matters
The decision to remove the local sourcing condition eases a major commercial hurdle for satellite broadband entrants, making India a more attractive market for global operators and investors. Industry leaders note that India’s domestic satellite hardware manufacturing capabilities remain nascent, making the prior localisation requirement difficult to fulfill practically. The rollback reflects a realistic, business-friendly approach to supporting satellite broadband expansion.
At the same time, maintaining security guardrails around satellite gateways ensures the government retains sovereign control over critical digital infrastructure. This approach balances the need to foster foreign investment and technological innovation with protecting national interests from data interception and other security threats. The new framework signals India’s strategic intent to develop its digital infrastructure without compromising on security.
What to watch next
Additionally, industry observers will monitor how India’s electronics and satellite hardware ecosystem evolves in response to the government’s pragmatic policy. Although immediate localisation is not required, sustained market demand and trusted supplier frameworks could eventually incentivize more local manufacturing capacity. The government’s approach of enabling foreign participation with a long-term view on domestic capabilities sets a precedent for other high-tech sectors.