New mergers and acquisition rules in India could potentially limit the amount of consolidation in the telecoms market, Financial Times reports.

A draft of the proposals puts restrictions on the ability of operators to acquire spectrum by investing in rivals companies. Operators will be required to pay the Indian government the current market price for any spectrum they acquire through a merger.

According to industry analysts, these rules would make it much less likely that major mobile players such as Bharti Airtel and Vodafone would make moves to acquire smaller operators.

The Indian telecoms industry has long been expected to consolidate from eight large players into four or five.

Tata Teleservices, Telenor, Sistema and Aircel are all thought to be open to merger possibilities. Telenor has previously said it will wait until the Indian government clarifies its M&A rules before it makes any moves.

Martin Pieters, chief executive of Vodafone India, told FT that he sees his company as a “natural consolidator” in the market. SingTel, meanwhile hopes Bharti Airtel, in which it holds a stake, will take a lead in any potential acquisition activity.

The M&A proposals are due to be published later this month.