The government's ambitious goal to expand the telecom sector rests critically on issues relating to right of way to infrastructure and the financial health of the operators, a senior industry representative said.
The telecom ministry has set its sight on a three-fold growth of telecom footprint across the country in the next five years in line with the projections of the Niti Aayog of a similar growth in the size of the economy by 2030.
Telecom service providers are wary of the twin challenges facing infrastructure expansion. Firstly, the availability of right of way to set up infrastructure such as towers and laying down cables. Second, the ability of the incumbents to finance the expansion given the rising share of non-performing assets.
"The first critical concern is to address the right of way problem," Rajan S Mathews, director-general of the Cellular Operators Association of India, told The Telegraph. Right of way is the legal authority to set up or use facilities along a specific route through grounds or property belonging to another. With land acquisition a challenge in different parts of the country, securing right of way on time is critical to support the infrastructure expansion.
The telecom ministry is looking at different aspects related to the right of way issue including common service ducts for underground infrastructure in the Indian Telegraph Right of Way Rules, 2016."Second critical aspect (to support expansion) is to make sure the industry is healthy," said Mathews.
According to the Economic Survey 2016-17, telecom bad loans in the books of public sector banks have fallen to Rs 2,335 crore in 2016-17 from Rs 3,465 crore in 2015-16.
However, this share of telecom in the total bad loans of the infrastructure sector increased to 8.7 percent in 2016-17 from 5 percent in 2015-16.
The Niti Aayog last year had projected the gross domestic product to reach around USD 7.5 trillion by 2030 from around USD 2.11 trillion in 2015-16. Telecom secretary Aruna Sundararajan said the telecom footprint of the country had to grow quickly to support the growth of the economy.
"If our GDP needs to go up from USD 2.5 trillion to USD 7.5 trillion, I think digital infrastructure growth must actually precede that. We must aim at a three-fold growth of the telecom footprint in the coming five years," Sundararajan said at the India Digital Open Summit on Friday.
She said the government is working on a set of policies including the new telecom policy to facilitate the growth of the sector. "There is a set of polices that the government is working on. Once we do that, and we are able to expand our footprint by three times, I think a lot of the digital dividend that we keep talking about will indeed start flowing to our citizens," she said.
As per government data, there were 1.185 billion telecom subscribers as of November 2017. – Telegraph India