Under the plan, only new entrants to the Indian market would be charged an entry fee. However, wireless provider Tatas, which offers CDMA services in India, said the government should not give away scarce spectrum. The carrier said it would be willing to pay a licencing fee for the right to offer 3G services.

The government is not obliged to accept the regulatory recommendations. So far, it has not indicated which way it is leaning. Moreover, there is confusion about how and when 3G services will begin here since there is no timetable for deployment.

While India's communications minister has advocated skipping 3G and moving India straight to 4G wireless technology, 4G specifications, applications and infrastructure remain undefined.

India is one of the fastest-growing telecom markets in the world, but the lack of direction has scared away some overseas telecom companies and investors.

Spectrum allocations have been a bone of contention for opposing GSM- and CDMA-based wireless phone services operators in India. The regulatory authority recommended that both services be given additional spectrum in the 800-, 900- and 1,800-MHz bands they currently use. It also recommended that both camps be given spectrum for 3G licences in the 2,000-MHz band.

The CDMA lobby said the recommendations favor GSM because providers could use the 2,000-MHz band to offer 3G services using current equipment. GSM carriers countered that giving CDMA carriers additional spectrum in the 800-MHz band means they get immediate backdoor entry into 3G services.

Regardless of what the government decides, litigation is considered likely since legal disputes have plagued India's mobile services market since its inception.