Telecom Sector – A Journey till 5G launch

The Indian telecom sector has seen exponential growth over the last few years, and India today has become the second-largest telecom market in the world, serving more than 117 crore telecom subscribers. Tele­communication is an enabler of digital governance that emphasizes the people-centric and data-driven delivery of goods and services to citizens and enterprises. The sector has the potential to unleash the true power of India’s economy and accelerate socio-economic trans­formation. Therefore, universal, resilient, secure, accessible, and affordable tele­communication is indispensable for an inclusive India.

The criticality of telecommunication was underlined amid the pandemic. The Covid-19 pandemic has necessitated the delivery of high-speed broadband internet service to many subscribers, including areas that do not have 4G mobile coverage. The segment emerged as a lifeline for the economy by enabling the digital economy to function. Interactions that form the core of a well-operational economy migrated from physical mode to digital mode. Specifically, remote working and online education gained popularity and societal acceptance.

Telecommunication helped sustain the demand for services, and enabled people to remain connected. Driven by affordable service, the number of telecom subscribers in India has grown from 1.5 crore in 1997 to more than 117 crore and is still rapidly growing. India has recently witnessed the much-awaited launch of 5G services in the country, one of the best gifts given to the citizens by Hon’ble Prime Minister, Shri Narendra Modi, at India Mobile Congress. In the recently conducted 5G spectrum auction, the spectrum worth ₹150,173 crore was sold by the Ministry of Communications, which will further improve the quality of service, and telcos will ensure robust 5G connectivity for our countrymen. 5G has the potential to transform the country by catalyzing a digital revolution. To make this a reality for the subscribers, telecom operators will further invest over ₹2–3 lakh crore in the next two to three years.

In September 2021, the Union Cabinet introduced bold struct­ural and procedural reforms, such as e-KYC, financial bank guarantee, 100 percent FDI under the automatic route, rationalization of adjusted gross revenue, rationalization of interest rates and penalties, and facilitating right of way (RoW) for telecom to address the telecom sector’s short-term liquidity needs as well as long-term issues.

The cumulative effects of all of these telecom reforms over the past year encouraged ease of doing business in the industry and supported the vision of the Hon’ble Prime Minister, Shri Narendra Modi, to enable connectivity to disconnected, rural, inaccessible locations of the country.

To provide further impetus to the growth of telecom, the government recently introduced the draft Telecommunication Bill in a bid to do away with the British-era laws governing the telecom sector. The bill aims to bring vast changes to how the telecom industry is governed, primarily by providing the center more powers in several areas. One of the most prominent changes the draft bill aims to introduce is the inclusion of platforms that currently provide calling services for free. The bill states that such platforms will be covered under a licensing regime and will have to operate as per the terms and conditions of traditional telecommunication services. Hence, they will have to obtain licenses from the government just like other telecom services do.

As a step to expedite the roll-out of 5G, the recently introduced Right of Way rules have simplified the process of deployment of underground (optical fiber) and over-ground (both mobile towers and optical fiber) infrastructure in India. The rules aim to rationalize the nominal one-time administrative fee that covers the cost of administration for the clearance/permit to be levied for granting permissions for the installation of telecommunication infrastructure on both private and government land and buildings across all states.

Another pillar that aims to transform the telecom sector is the BharatNet scheme. The Government of India approved the National Optical Fiber Network (NOFN) initiative, later renamed as BharatNet, which aims to establish a highly scalable network infrastructure accessible to provide on-demand and affordable broadband connectivity of 2 Mbps to 20 Mbps for all households, and on-demand capacity to all institutions in partnership with states and the private sector. It has the potential to transform rural India with its goal to provide high-speed broadband connectivity to the 250,000-plus village panchayats spread across India’s 6600 blocks and 640 districts. Taking the momentum ahead, DoT has recently approved financial support of ₹26,000 crore to deploy 25,000 new mobile towers in the coming 500 days, which will be provided by USOF and implemented by Bharat Broadband Network.

These initiatives have enhanced the 5G readiness of India and, as per an industry report by Ericsson, 5G readiness in India is two times higher than in the US and UK where 5G services are already available. In the last two years, India has observed a three-time increase in 5G-enabled smartphones. 5G is expected to provide 10 times higher data speed than what we get today from 4G, which will enable us to share data, watch online videos, and download heavy files within seconds. This will also boost virtual or online activities like work-from-home and virtual meetings, which have become the latest trend now. It will also address the issue of the digital divide with improved infrastructure and connected communities.

5G will be a major force in realizing India’s vision to become a USD 1Tn digital economy by 2025. It will also pave way for the rise of new technologies that can transform the digital ecosystem and put a step forward to achieving the Digital India vision of Hon’ble Prime Minister, Shri Narendra Modi.