Digital Firms Raise Alarm Over Mobile Number Validation Rules in India

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• Digital firms have raised concerns over India’s draft Telecom Cyber Security Rules, 2025, citing jurisdictional overreach and high compliance costs due to proposed mobile number validation requirements.

Introduction

• India’s digital economy may soon face new compliance burdens due to a draft rule under the Telecommunications (Telecom Cyber Security) Amendment Rules, 2025. 
• Proposed by the Department of Telecommunications (DoT), the new framework mandates mobile number validation to ensure subscribers are legitimate users. 
• While intended to strengthen cyber security, the rule has sparked serious concerns among tech companies about its legal scope, cost implications, and regulatory overreach.

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Scope of the Draft Telecom Cyber Security Rules, 2025

• The draft rule introduces the concept of a Telecommunication Identifier User Entity (TIUE), defined broadly as any person or entity (excluding licensed telecom operators) that uses telecom identifiers like mobile numbers for delivering services or identifying users. 
• This wide definition has triggered alarm among digital firms, as it could include virtually every online platform, from fintech and social media to e-commerce and ride-hailing services.
• The proposed framework enables telecom operators to charge up to Rs 3 per validation request, providing confirmation of the subscriber’s legal identity linked to a mobile number.

Industry Concerns on Jurisdiction and Regulatory Overreach

• The Internet and Mobile Association of India (IAMAI), representing global players like Google, Apple, and Amazon, has called the move a case of legislative overreach. 
• In its submission to the DoT, IAMAI argued that the draft rules extend telecom-style regulation to entities that neither provide telecom services nor control telecom infrastructure.
• The association warned that this expansion of regulatory authority could have widespread consequences for digital service providers, especially in sectors such as:
  • Fintech and digital payments
  • Mobility and e-commerce platforms
  • OTT content providers and social media
  • Micro, Small and Medium Enterprises (MSMEs)
• IAMAI emphasised that such rules were not envisioned under the Telecommunications Act, 2023, making their extension to unrelated sectors legally questionable.

Financial Burden and Operational Disruption

• Although Rs 3 per mobile verification may seem nominal, IAMAI warned that it would add up quickly for platforms handling millions of users. 
• For startups and MSMEs, these recurring costs could reshape business models or compel platforms to pass the burden onto consumers via price hikes or service restrictions.
• CUTS International, a policy think tank, echoed these concerns. 
• It noted in its regulatory impact assessment that the net benefit of the draft rules could be negative, especially when alternative cybersecurity initiatives are already underway. 
• CUTS advised the government to focus on streamlining existing cyber safety frameworks rather than introducing fragmented and potentially burdensome mechanisms.

Potential for Mandatory Enforcement in Specific Sectors

• While the DoT has hinted that the validation framework may remain optional for private entities, the draft language leaves room for later mandatory adoption. 
• Experts pointed out that the vagueness around implementation adds to business uncertainty.
• Legal analysts questioned whether the DoT even had the authority to mandate such rules across non-telecom sectors, suggesting that the proposal may violate the separation of regulatory domains.

The Broader Debate on Digital Regulation in India

• This controversy comes amid a larger push by the Indian government to tighten digital security through legislation. Recent moves like:
  • The Digital Personal Data Protection Act, 2023
  • The Digital India Act (in draft stage)
  • Expanded roles for CERT-In and the MeitY
• reflect an assertive approach to securing India’s growing digital landscape. 
• However, concerns about regulatory overlap, business costs, and innovation slowdowns are increasingly surfacing.
• As India aims to be a global digital innovation hub, the challenge lies in balancing national security objectives with ease of doing business, especially for small tech enterprises and startups.

Source : TH