Prime Minister Manmohan Singh on Thursday said troubles facing telecom sector are ending and the new policy being ushered in will address concerns of worrying investors and provide impetus to growth.

Addressing the India Telecom 2012 conference, Singh said the government allocated airwaves or spectrum carrying mobile phone signals in a transparent manner through market-related processes.

"This sector has had to face some tough challenges in the past months. However, I believe that under the distinguished leadership of (Telecom Minister) Kapil Sibal, the period of difficulties is now coming to an end," he said.

During the last one year, the government has attempted to clarify the policy positions on a number of complex issues.

"I am confident that the futuristic policy regime that we are now putting in place will address, and address effectively, the concerns that have been worrying investors and will provide a new impetus to the growth of telecommunication industry in our country," he said.

Singh said while urban areas have seen rapid penetration of telecom services, rural India has low teledensity of 41 per cent.

"Not only this, the bulk of the 59 percent people who do not use phones in rural areas is perhaps from the socially and economically backward sections of our society," he said.

He asked the Department of Telecommunications to use USO Fund to bridge the rural-urban divide. "The New Telecom Policy-2012 envisages 70 per cent rural penetration by 2017 and 100 per cent by 2020."

Stating that there was a direct correlation between an increase in broadband connectivity and growth in country's GDP, he said broadband improves the lives by providing affordable access to information and knowledge.

"I would also like to reflect on the thinning down of our domestic manufacturing capabilities in telecom in particular and in electronics in general over the past two decades," the Indian Prime Minister said, emphasising on need to strengthen domestic manufacturing capabilities.

"We need leaders in telecom and electronics manufacturing who can break new ground and create the ecosystems to enable India to be a major producer of hardware," Singh said.