Summary:
TRAI is exploring the introduction of a new service authorization under the Telecommunications Act to enable regulated use of foreign SIMs and eSIMs in export-bound IoT and M2M devices. This move aims to streamline compliance and support Indian manufacturers who need short-term in-country activation for testing and prototyping.
The Telecom Regulatory Authority of India (TRAI) has released a consultation paper proposing a new authorization framework for the sale and use of foreign SIM cards and eSIMs in machine-to-machine (M2M) and Internet of Things (IoT) devices meant exclusively for export. The regulator is seeking industry feedback to address regulatory gaps under the existing No-Objection Certificate (NOC) policy, which does not currently allow temporary in-India activation of such SIMs required for testing and prototyping.
Why TRAI is Considering a New Authorization for Foreign SIMs
Indian manufacturers producing export-oriented IoT devices often import foreign SIMs to be integrated into products that are shipped abroad. However, short-term local activation is needed to test these devices before export. The current policy mandates strict KYC norms and prohibits such activation, creating a regulatory hurdle for manufacturers.
The Department of Telecommunications (DoT) noted that although these SIMs are not intended for domestic use, a brief activation window is necessary to validate functionality, particularly for industries like automotive, healthcare, surveillance, agriculture, and smart utilities, where reliability is crucial.
Key Points from the TRAI Consultation Paper
- Proposal for a new service authorization under the Telecom Act specifically for foreign SIM/eSIM sale in export-bound devices.
- KYC flexibility for short-term in-country activation for testing, sampling, or prototyping.
- Stakeholder feedback invited on eligibility, licensing validity, authorization fee structure, penalties, and coordination with other regulators such as RBI and Customs.
- Consideration of the CII’s recommendation to expand the NOC policy with the condition that such SIMs are non-functional within India post-testing.
Boosting India’s IoT and M2M Manufacturing Ecosystem
India’s IoT and M2M sector is still in a nascent stage, but with rapid growth potential. TRAI’s move supports the government’s vision under the National Telecom M2M Roadmap (2015) and National Digital Communication Policy (NDCP-2018) to create a globally competitive digital manufacturing ecosystem.
By removing regulatory friction and enabling streamlined compliance, this initiative will:
- Support ‘Make in India’ for global markets
- Promote domestic innovation
- Strengthen India’s position in the global IoT supply chain
What TRAI is Asking From Stakeholders
TRAI is inviting inputs on:
- Eligibility criteria for licensees
- Duration and scope of the proposed authorization
- Coordination mechanisms with RBI, Customs, and other authorities
- Suggestions for maintaining security and preventing misuse
