NEW DELHI (Reuters) - Starlink boss Elon Musk said a move by India to auction satellite broadband spectrum, and not allocate it, would be "unprecedented", reacting to a Reuters story that rival billionaire Mukesh Ambani was lobbying for the auction route.

In what is seen as a battle between the two billionaires, Starlink argues administrative allotment of licences is in line with a global trend, while Ambani's Reliance says an auction is needed for a level playing field as foreign players could offer voice and data services and compete with traditional telecom players.

On Sunday, Reuters reported Ambani's Reliance has argued India's telecom regulator has incorrectly concluded that home satellite broadband spectrum should be allocated and not auctioned, without seeking industry feedback, and the consultation process must start afresh.

Reacting to the news, Musk wrote on X that any such decision to auction as Reliance is lobbying for "would be unprecedented."

"This spectrum was long designated by the ITU as shared spectrum for satellites," he wrote late on Monday on X, referring to the International Telecommunication Union (ITU), a specialized UN agency for digital technology.

India is a member of the ITU and signatory to its treaty that regulates satellite spectrum and advocates that allocation must be done "rationally, efficiently and economically" as it's a "limited natural resource."

Reliance did not respond to a request for comment on Tuesday. It has previously told Reuters it is "imperative" upon the Indian regulator to consult on the methodology of spectrum assignment.

The methodology of giving out spectrum for satellite services in India - a market set to grow 36% a year to reach $1.9 billion by 2030 - has been a contentious issue since last year.

Musk's Starlink and global peers like Amazon's Project Kuiper back an administrative allocation, saying it is a natural resource that should be shared by companies. Ambani, Asia's wealthiest man, is arguing for an auction process.

Reliance's latest lobbying move in India has intensified a face-off with Musk who wants to launch Starlink services in India but has voted for the spectrum allocation route, in which the government simply assigns spectrum to the companies.

An Indian government source told Reuters on Sunday the regulator was following due process of consultation.