A smartphone for every Indian and free Internet for all for one year. This is what is required for the government to realize the Digital India and Make in India mission. The socioeconomic benefits will be tremendous.
It is not new for India. This has been done before. The then ruling party, DMK in 2006 announced that all households in Tamil Nadu state, who did not have color TV sets, would be provided with a free 14-inch CTV set from state funds. And over five years, 2006–2010, 1.52 million sets, at a cost of Rs.3481 crore were distributed. ELCOT was nominated as the procurement agency; tenders invited from Indian TV makers; procurement made at extremely competitive prices; and the election promise fulfilled.
The government has the funds; the October 2016 spectrum auction fetched Rs.65,789 crore. There is no reason why the collection from the telecom industry should not be spent on the same industry to provide the requisite impetus.
The current Internet penetration in India is a mere 31 percent. And average data consumption per user, per month in India continues to be as low as 1 GB, vis-a-vis 2-3 GB in developing countries and 10 GB in developed economies.
The smartphone penetration in India, even after doubling the 2014 number, is only 20 percent, as compared to 50 percent in China and 63.5 percent in USA. With more than 83 million Made in India smartphones in 2016, a nascent industry exists here.
The government can no longer look at the telcos to bail the industry out. With a Rs.4.9 lakh crore of debt, declining revenues and profitability, in the midst of a bruising rate war, with some looking to the DoT to give the option to defer payments for spectrum bought in the 2013 auctions, these players need nurturing. Airtel posted its worst profit fall and Idea its first net loss since their respective listings, in the October–December quarter, and both are expected to report weak results for the January–March quarter as well.
Will this fly with the powers that be? Does the Robin Hood Modi government have the gumption to provide what may well be a Rs.100,000 crore push to the economy?