India will not accept any new telecoms licence applications after October 1, a statement from the government's telecommunications ministry, quoted by a Reuters report, said.
The Reuters report said the agency however did not give any reason for the decision.
A spate of new applications from firms with no prior telecoms experience has been lodged, with real-estate to technology firms expressing an interest in joining the world's fastest growing mobile phone market, the report said.
India, now adding about 8 million mobile users every month, is forecast to top 500 million subscribers in five years, from 200 million now, making it an attractive market for investment, the Reuters report said.
Carriers have requested the government to allot fresh frequencies to ease congestion, including those currently used by the defence forces, the report added.
Existing GSM operators want the government to give them preference as many have had applications pending since December 2006, when the government last issued licences, the report said.
But new entrants are also vying for spectrum, arguing established firms have failed to efficiently use the frequencies already allocated to them.
Earlier, India's telecoms minister, Andimuthu Raja, said the government would form new guidelines to help it scrutinise applications and narrow down the list of interested firms, given the limited spectrum available, accoding to the report.