Sandboxing Framework in the Telecommunications Sector
The Department of Telecommunications (DoT) notified the Telecommunications (Regulatory Sandbox) Rules, 2026, on 21 October 2026. Framed under the Telecommunications Act, 2023 (the Act), the Rules establish a framework for controlled testing of innovative telecommunications technologies, services and business models.
Statutory Basis and Background
Section 27 of the Telecommunications Act, 2023, provides for regulatory sandboxes to facilitate innovation and technological development. A regulatory sandbox is a live testing environment in which new products, services, processes and business models may be deployed with a limited set of users for a specified period, subject to certain regulatory relaxations.
On a reference from DoT, Telecom Regulatory Authority of India (TRAI) released a consultation paper on 19 June 2023 and issued its recommendations on 12 April 2024. DoT published draft Rules on 27 November 2024 and later sent a back-reference to TRAI on 19 March 2025, to which TRAI responded on 25 April 2025. The final Rules came into force on 21 October 2026, on publication in the Official Gazette.
Eligibility and Application
Eligible applicants include authorised entities, companies, societies, partnership firms and statutory bodies established under Indian law, Indian nationals, and research and development institutions recognised by the Department of Science and Technology.
Proposals may be submitted independently or in response to a request for proposals issued by the Central Government. Applications must be filed through the designated portal with reports of previous laboratory or offline testing, reports of other testing, including in experimental isolated networks, prescribed documents and details of exemptions sought. A non-refundable processing fee of ₹10,000 is payable. The Government may seek further information before accepting or rejecting a proposal.
The Telecom eServices Portal was separately designated for digital implementation of the Rules.
Creation of a Sandbox and Regulatory Exemptions
The Rules do not themselves establish any specific sandbox. The Central Government may create one by order, either on its own initiative or upon acceptance of an applicant’s proposal. The order may specify the sandbox’s objectives, eligible participants, approved applicants, testing scope, risk-management measures, reporting requirements, duration and exit strategy.
Exemptions may extend to authorisation or assignment requirements and other provisions of the Telecommunications Act, 2023, and rules made under it. They may also cover provisions of the Telecom Regulatory Authority of India Act, 1997, and regulations made under it.
Such exemptions are not automatic or blanket relaxations. Their scope depends on the order governing the particular sandbox.
Duration and Safeguards
A sandbox may operate for an initial period of up to 24 months. The Central Government may extend its validity by up to 12 months at a time. An extension request must be submitted at least 30 days before expiry, with reasons and justification.
Where test users are enrolled, the approved applicant must explain the purpose and scope of testing, obtain their prior consent and ensure they are not charged for participation. The technology, service, product, process or business model under testing must not be commercially available in the market during the testing period.
Approved applicants must comply with applicable data protection laws, maintain testing and consent records for at least one year after the sandbox expires, or longer if required by the Government and securely destroy the records thereafter. They must also indemnify the Central Government against liability arising from testing and maintain confidentiality, subject to the Government’s ability to publish general information without disclosing proprietary information.
Monitoring, Closure and Revocation
The Central Government may monitor testing, call for records, issue directions and require physical or virtual access to the sandbox. A comprehensive report must be submitted within 15 days of completion of testing or at least 30 days before expiry. It must cover results, user feedback and complaints, security issues, risk-mitigation measures and settlement of relevant contractual and financial obligations.
Based on the reports, the Government may continue or modify the sandbox, direct its closure, or permit steps necessary for commercial deployment in accordance with the Act and applicable rules. Completion of testing does not, by itself, authorise commercial operation.
Approval may be suspended or revoked by a reasoned order if the sandbox interferes with an authorised entity’s network, the applicant provides false information or fails to comply with applicable conditions, suspension or revocation is necessary in the interest of national security or public interest, or the applicant is found in breach following adjudication proceedings under Chapter VIII of the Act. An opportunity of hearing is expressly required for the grounds relating to false information and non-compliance. Fees are not refundable if approval is suspended, curtailed, revoked or varied.
Conclusion
The Rules may be particularly significant for innovators seeking to evaluate the practical viability of new telecommunications technologies before committing to wider deployment. They may also help the Government identify the challenges associated with testing and regulating emerging technologies. Ultimately, their impact will depend on whether regulatory flexibility translates into a practical pathway from experimentation to commercial adoption, without compromising security or consumer protection.
