"The government has decided to release 3G spectrum in 2.1 GHz band with immediate effect," Communications Minister A Raja told reporters in New Delhi.
Number portability, which would allow users to change their service provider while keeping the numbers, will be introduced in the four metropolitan cities at the earliest.
Department of Telecommunications Secretary D S Mathur said about 30 MHz spectrum can be released to accommodate three players in the first phase.
Asked whether only existing 2G players will be allowed to offer 3G services, Raja said, "No. I want healthy competition; I want all the players to bid for it. As far as foreign players are concerned, they will be allowed subject to security clearances by Ministry of Home Affairs.
"The 3G licenses will be granted through a controlled, simultaneous ascending e-auction, by a specialized agency to ensure transparency in selection process," the minister said.
3G services will give users a better multimedia experience, with faster data transfer rates. At present, cellular operators offer only 2G services.
Although he did not give any time frame for introduction of number portability, Raja said he would try to implement it in the four metros by this year-end.
A meeting will be held with existing operators to seek their cooperation.
On 3G spectrum, he said besides the initial one-time charge, it has been decided that the successful bidder will pay additional spectrum charge of 0.5 per cent of the total adjusted gross revenue as recurring annual fee. This additional revenue share is proposed to be doubled to on one per cent of AGR after 3 years from the date of spectrum assignment
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