The telecom regulator’s formula to propel India to be among the top 50 nations in the global ICT Index would require massive coordination between various government departments if it has to become a reality. The country would need an investment of $100 billion by 2022 to achieve this target at a time when almost all the telecom operators are under massive financial stress.
TRAI has also set a target to ensure availability of bandwidth on demand through wireline, including cable TV and optical fibre networks to 30 percent households by 2020 and 50 percent households by 2022. It has said that at least 1 Gbps data connectivity to all gram panchayats to enable wireless broadband services to inhabitants by 2022 and achieve 900 million broadband subscriptions supporting download speed of 2 Mbps, out of that at least 150 million broadband subscriptions supporting download speed of 20 Mbps and 25 million at a download speed of 50 Mbps by 2022.
While these targets sound fantastic, the big issue is that the regulator has not said anything about how this will be funded. “TRAI has said that there should be review of the licence fee regime and has also hinted at possible reduction in levies but it should have prescribed a time frame for that as well,” said a top executive of a cellular company.
“If TRAI can set targets for infra creation and subscriber acquisition, it could have also listed out how this will be funded. Telecom operators pay as much as 30 percent of their revenues in levies and charges to the Centre. TRAI should have pushed for a reduction in levies,” said another player.
The industry has been asking for fiscal relief to tide the current crisis. The Economic Survey also recently flagged the concerns around the huge debt burden on the industry. “It is important to note that the telecom sector is going through a stress period with growing losses, debt pile, price war, reduced revenue and irrational spectrum costs,” the Survey said.
“A new entrant has disrupted the market with low-cost data services and the revenue of incumbent players has fallen. The crisis has also severely impacted investors, lenders, partners and vendors of these telecom.”
The regulator has, however, come up with some innovative ideas on setting up a telecom ombudsman to deal with consumer issues at a national level, creation of a network readyness index to monitor infrastructure creation at the State level and to shift to measuring tele-density on the basis of connections owned by each individual.
Even after achieving almost 100 percent mobile tele-density, approximately 49.5 percent population is still remains unconnected. Approximately 30 percent of India’s population is below the age of 15 years and all of them may not require/ subscribe to independent mobile connections. So the remaining 70 percent population may be considered as target population for communication services market.
“Therefore, in order to have a realistic assessment of access and affordability of telecommunication services, we need to shift focus from tele-density to ‘Unique Mobile Subscriber Density’, wherein each subscriber will be counted once, irrespective of multiple connections a subscriber has subscribed. Accordingly, the target has been set for connecting approximately 90 percent of the target population by 2022,” TRAI said. – The Hindu Business Line