India overtakes US with world's second largest telecom network

Indian telecom has emerged the second largest wireless network in the world after China, and surpassing the US. The telecom network in the country, with about 364 million connections as of October 2008, was the third largest in the world and at the current pace of growth, where about nine million telephones are being added every month, the target of 500 million connections by 2010 is well within our reach, the government said in a release.

The telecom sector continued to register significant growth in the current fiscal year as well despite the global economic slowdown, mainly due to the impact of economic reforms and pro-active policies of the government, it said.

The government expects to achieve a target of 600 million telephone subscribers by the end of the Eleventh Plan and to achieve rural teledensity of 25 per cent, with 200 million rural connections at the end of 11th Plan.

The internet and broad-band subscriber base in the country is also expected to increase to 40 million and 20 million, respectively, by 2010.

The total number of telephone connections has increased from 76.53 million as of 31 March 2004 to 363.95 million as of 31October 2008. While 94.63 million telephones were added during the twelve months of 2007-08, more than nine million subscribers are being added every month during the current fiscal year, it said.

Tele-density has also increased from 12.7 per cent in March 2006 to 31.50 per cent in October 2008. Rural teledensity increased to 13.4 per cent in October 2008 with 109.05 million rural telephone connections. Urban teledensity on the other hand has been 74.61 per cent in October 2008.

The wireless subscriber base grew at a compounded annual growth rate (CAGR) of 87.7 per cent per annum since 2003. The number of wireless phones has risen to 325.7 million as of October 2008.

The share of wireless phones has increased from 24.3 per cent in March 2003 to 89.50 per cent in October 2008. Improved affordability of wireless phone has made universal access objective more feasible, it noted.

The share of private sector in total telephone connections is now 77.44 per cent as per the latest statistics available for October 2008 as against a meager 5 per cent in 1999.

Rural telephones have gone up from 12.3 million in March 2004 to 109.05 million in October 2008 with a teledensity of 13.04 per cent. The target of 100 million rural telephones by 2010 has been achieved well in advance. Out of more than 22.71 lakh public call offices (PCOs) functioning in the country, two lakh are in the rural areas. The Mobile Grameen Sanchar Sewak Scheme providing telephone at the doorstep of villagers in about 12,000 villages is also in place.

To provide infrastructure support for mobile services, a scheme has been launched to provide support for setting up and managing 7,871 infrastructure sites spread over 500 districts in 27 states of the country for the provision of mobile services, it said.

The infrastructure will be shared by three service providers for provision of mobile services. Mobile services from these towers are likely to be launched in a phased manner by the end of year 2008. As of 30 September 2008, about 1,589 towers have been set up under this scheme. Mobile services from 1,517 BTSs installed on many of these towers have also started.

Internet and broadband subscriber base is expected to increase to 40 million and 20 million, respectively by 2010. As per the latest available statistics for September 2008, about 5.7 per cent villages have broadband coverage with around 1.55 lakh rural broadband connections.

With the aim to provide e-governance and data services to the rural masses, a proposal is being considered to provide support of broadband connectivity in rural and remote areas of the country in a phased manner.  Under this scheme, 5,000 blocks shall be connected by wireless broadband and villages coming within a radius of 10 km of the taluk/block headquarters will be covered by such connectivity.

To achieve the stipulated target, the government has issued guidelines for Broadband Wireless Access (BWA) Services. Introduction of BWA services will enhance the penetration as well as growth of broadband subscribers.

During 2008-09, production of telecom equipment in the country is expected to increase from Rs41,270 crore (2007-08) to Rs51,800 crore. During 2007-08, the highest increase has been recorded in wireless equipment manufacturing, including cellular mobile phones where the production has gone up from Rs10,545 crore in 2006-07 to Rs28,600 crore in 2007-08, recording a growth of 171 per cent.

The FDI policy allows 74 per cent to 100 per cenr foreign investment in various telecom services. The total FDI equity inflows in telecom sector have been $1,261 million during 2007-08.

The government is now looking forward to achieve the target of 600 million telephone subscribers by the end of Eleventh Plan and to achieve rural teledensity of 25 per cent by adding 200 million rural connections by the end of 11th Plan. It is also envisaged that internet and broad-band subscribers will increase to 40 million and 20 million, respectively, by 2010.