Free Essays for Competitive Exams-Unprecedented Growth of the Telecom Sector

Unprecedented Growth of the Telecom Sector

In India, telephone service was first introduced in Kolkata in 1881-82, barely six years after the invention of telephone. The first automatic telephone exchange was commissioned at Shimla in 1913-14 with a capacity of 700 lines.

            The telecommunication services have improved significantly with the sector witnessing a series of reform measures that included, announcement of National Telecom Policy in 1994 that defined certain important objectives, including availability of telephone on demand, provision of world class services at reasonable prices, ensuring India’s emergence as major manufacturing / export base of telecom equipment and universal availability of basic telecom services to all villages. Telecom Regulatory Authority of India (TRAI), the independent regulator, was established in 1997 and New Telecom Policy was announced in 1999, which further laid stress on providing an enabling framework for the development of this sector and to facilitate India’s vision of developing a world class telecom infrastructure in the country. Since then, Indian telecom sector has come a long way in achieving its dream of providing affordable and effective communication facilities to its citizens. 

            The reform measures coupled with the proactive policies of the Department of Telecommunications and active participation by private sector have resulted in an unprecedented growth of the telecom sector. Telecom sector has witnessed exponential growth, especially in the wireless segment, in the last few years. Today, with 921.47 million telephone connections at the end of November 2012, the Indian telecom network is second largest in the world, only after China. With 890.60 million telephone connections at the end of November 2012, the Indian wireless telephone network is also second largest in the world. Tele-density, which shows the number of telephones per 100 population in the country, was 75.55 % at the end of November 2012.

            Telecom has evolved as a basic infrastructure like electricity, roads, water etc. and has also emerged as one of the critical components of economic growth required for overall socio economic development of the country.A study conducted recently has found that, in India, 10% increase in internet subscribers delivers, on an average, 1.08% increase in GDP. In the 10 States which had higher penetration of Internet, the increase in growth was higher at 2.36%, on an average, for 10% increase in Internet penetration. In the year 2009-10, these 10 States, referred to as ‘relatively developed States’ had Internet penetration rate of 2.76% compared to the set of 9 ‘Developing’ States having average Internet penetration rate of only 0.61%. The Study has also found that a 10% increase in mobile penetration delivers, on an average, 1.5% increase in GDP.

National Telecom Policy-2012 (NTP-2012)

            The Government approved National Telecom Policy-2012 (NTP-2012) on 31^st May 2012 which addresses the Vision, Strategic direction and the various medium term and long term issues related to telecom sector. The primary objective of NTP-2012 is maximizing public good by making available affordable, reliable and secure telecommunication and broadband services across the entire country. The main thrust of the Policy is on the multiplier effect and transformational impact of such services on the overall economy. It recognizes the role of such services in furthering the national development agenda while enhancing equity and inclusiveness. Availability of affordable and effective communications for the citizens is at the core of the vision and goal of the NTP-2012. NTP-2012 also recognizes the predominant role of the private sector in this field and the consequent policy imperative of ensuring continued viability of service providers in a competitive environment. Pursuant to NTP-2012, these principles would guide decisions needed to strike a balance between the interests of users/ consumers, service providers and government revenue.

The objectives of the NTP-2012, inter-alia, include the following:

Provide secure, affordable and high quality   telecommunication services to all citizens.

Strive to create One Nation - One License across services and service areas.

Achieve One Nation - Full Mobile Number Portability and work towards One Nation - Free Roaming.

Increase rural tele-density from the current level of around 39 to 70 by the year 2017 and 100 by the year 2020. .

 To recognize telecom, including broadband connectivity as a basic necessity like education and health and work towards ‘Right to Broadband’.

Provide affordable and reliable broadband-on-demand by the year 2015 and to achieve 175 million broadband connections by the year 2017 and 600 million by the year 2020 at minimum 2 Mbps download speed and making available higher speeds of at least 100 Mbps on demand.

  Provide high speed and high quality broadband access to all village panchayats through a combination of technologies by the year 2014 and progressively to all villages and habitations by 2020.

 Recognize telecom as Infrastructure Sector to realize true potential of ICT for development

 Address the Right of Way (RoW) issues in setting up of telecom infrastructure.

 Mandate an ecosystem to ensure setting up of a common platform for interconnection of various networks for providing non-exclusive and non-discriminatory access.

Enhanced and continued  adoption of green policy in telecom and incentivize use of renewable resources for sustainability

 Achieve substantial transition to new Internet Protocol (IPv 6) in the country in a phased and time bound manner by 2020 and encourage an ecosystem for provision of a significantly large bouquet of services on IP platform.

Manufacturing of Telecom Equipment

            The exponential growth witnessed by the telecom sector in the past decade has led to the development of the telecom equipment manufacturing and other supporting industries within the country. With the advent of next-generation technologies and operators rolling out 3G and broadband wireless access services, the demand for telecom equipment has increased. In an attempt to capitalize on this opportunity, the government and policymakers are focusing on developing the domestic manufacturing industry. Despite significant growth of the telecom network and the subscriber base over the last decade, the telecom manufacturing sector has not shown corresponding increase.

            The NTP-2012, inter-alia, has following objectives on promoting Telecom Equipment Manufacturing:

Create a corpus to promote indigenous R&D, IPR creation, entrepreneurship, manufacturing, commercialisation and deployment of state-of-the-art telecom products and services during the 12th five year plan period.

  Promote the ecosystem for design, Research and Development, IPR creation, testing, standardization and manufacturing i.e. complete value chain for domestic production of telecommunication equipment to meet Indian telecom sector demand to the extent of 60% and 80% with a minimum value addition of 45% and 65% by the year 2017 and 2020 respectively.

 Provide preference to domestically manufactured telecommunication products, in procurement of those telecommunication products which have security implications for the country and in Government procurement for its own use, consistent with our World Trade Organization (WTO) commitments.

National Optical Fiber Network (NOFN)

            The optical fiber has predominantly reached state capitals, districts and blocks, at present. Government has approved a project, at a cost of Rs. 20,000 crore, for creating a National Optical Fiber Network (NOFN) to connect all the 2,50,000 Gram panchayats in the country through optical fiber utilizing existing fibers of PSUs viz. BSNL, RailTel and Power Grid and laying incremental fiber wherever necessary. Non-discriminatory access to the network will be provided to all the telecom service providers.  These access providers like mobile operators, Internet Service Providers (ISPs), cable TV operators, content providers can launch various services in rural areas. Various applications for e-health, e-education, e-governance etc. will be provided. The project will be funded by USOF and is being executed by a Special Purpose Vehicle (SPV) namely Bharat Broadband Network Limited (BBNL), which has been incorporated on 25.02.2012 under Indian Companies Act 1956.

Transition to New Internet Protocol (IPv6)

            IPv6 (Internet Protocol Version 6) is next generation Internet Protocol. With depletion and exhaustion of address space provided by IPv4 (Internet Protocol Version 4), it becomes essential to transit to IPv6 which provides huge address space and many features for future needs. Countries around the world have started transition to IPv6. India is the first country in the world where any Government has released National IPv6 deployment roadmap with the policy decisions. The Government has planned to achieve substantial transition to IPv6 in the country in a phased and time bound manner under the NTP-2012. NT Cell of DoT is lead body for carrying out the process of IPv6 transition in the country. National IPv6 deployment Roadmap (v-1) was released in July, 2010. With the efforts of NT Cell, most of the Service Providers are now ready to offer IPv6 services across the country.

Universal Service Obligation Fund (USOF)

            The Universal Service Obligation Fund formed by an Act of Parliament is headed by the Administrator USO Fund, appointed by the Central Government, for the administration of the Fund. He is empowered to formulate procedures for implementation of USO Fund schemes and disbursement of funds from USOF. Its office works as an attached office of the Department of Telecom, Ministry of Communications and Information Technology.

            A scheme was launched by Government through USO Fund to provide financial support for setting up and managing 7353 number of infrastructure sites/ towers in 500 districts spread over 27 states for provision of mobile services in the specified rural and remote areas, where there was no existing fixed or mobile coverage. Villages or cluster of villages having population of 2000 or more and not having mobile coverage were taken into consideration for installation of the tower under this scheme. The infrastructure so created is being shared by three service providers for provision of mobile services.

VPTs in newly identified uncovered villages as per Census 2001: Reconciliation of the VPTs working in the inhabited villages as per Census 2001 was carried out taking into account the existing VPT and those provided under Bharat Nirman. All the remaining 62,443 inhabited villages as on 01.10.2007 as per Census 2001 irrespective of criteria of population, remoteness, accessibility and law &order situations have been included for provision of VPTs with subsidy support from USO Fund under this scheme. Agreements in this regard were signed with BSNL on 27.02.2009.

Achievements for the Year 2012

            The total number of telephone connections increased from 926.55 million to 965.52 million during the period from January to June 2012, resulting in increase of tele-density from 76.86 % to 79.58 %. Thereafter, number of telephone connections declined to 921.47 million by the end of November 2012, resulting in decline in tele-density to 75.55 %. The net decline of telephone connections was 5.08 million during the period January to November 2012. The number of rural telephone connections increased from 315.39 million to 343.88 million during the period from January to June 2012, resulting in increase of rural tele-density from 37.52 % to 40.71 %. Thereafter, number of rural telephone connections declined to 343.74 million by the end of November 2012, resulting in decline in rural tele-density to 40.54 %. The number of urban telephone connections increased from 611.16 million to 621.64 million during the period from January to June 2012, resulting in increase of urban tele-density from 167.46% to 168.62%. Thereafter, number of urban telephone connections declined to 577.73 million by the end of November 2012, resulting in decline in urban tele-density to 155.40 %. The decline in telecom user base after June 2012 was primarily due to the removal of inactive mobile telephone connections by the service providers.

            The number of internet subscribers increased from 22.39 million (including 13.35 million broadband subscribers) to 24.01 million (including 14.68 million broadband subscribers) during the period from January to September 2012. At the end of November 2012, there were 14.88 million broadband subscribers in the country.

Auction of Spectrum

            Auction of Spectrum in 1800 MHz band that commenced on 12.11.2012 has been completed.  Five companies participated in the auction.

National Optical Fiber Network (NOFN) Project

NOFN Project is envisaged as a Centre-State joint effort. State Governments are expected to contribute by way of not levying any RoW charges. This requires suitable tri-partite MoU to be signed by GOI, State Governments & BBNL.

Tri-partite MoU has been signed on 26.10.2012 with 13 States viz. Andhra Pradesh, Arunachal Pradesh, Chhattisgarh, Jharkhand, Karnataka, Manipur, Mizoram, Rajasthan, Tripura, Uttar Pradesh, Uttarakhand and 3 Union Territories viz. Dadra & Nagar Haveli, Daman & Diu and Puducherry.  A total of about 1,40,727 Gram Panchayats will get covered by Optical Fibre Network in these States and UTs.

Three Pilot Projects have been completed to cover all Gram Panchayats of Arain Block in Ajmer District (Rajasthan), Panisagar Block in North Tripura District (Tripura), Paravada Block in Vishakhapatnam District (A.P.). As on 15.10.2012, each of the 58 Gram Panchayats in these three Pilot Project Blocks have been provided with 100 Mbps bandwidth.

Survey work for ‘laying of incremental OFC’ has commenced based on GIS data made available by NIC.

 BBNL has allocated the work of laying incremental OFC amongst 3 CPSUs (Central Public Sector Undertakings) i.e. BSNL, RailTel and Power Grid.

Universal Service Obligation Fund (USOF)

            Various initiatives have been taken by DoT to cover the uncovered rural and remote areas of the country, with the support from USO fund. The achievements with regard to various OSOF schemes are listed below:

 424 Village Public Telephones (VPTs) have been provided during the year 2012 till October 2012. At the end of October 2012, 5.80 lakh (97.76 %) villages were covered with VPTs.

As on 31.10.2012, 53452 VPTs out of the 62443 i.e. 85.60 % VPTs have been provided under VPTs in newly identified uncovered villages as per Census 2001.

14 Mobile Towers and 209 Base Transceiver Stations (BTSs) have been commissioned by Infrastructure Providers and Universal Service Providers respectively under the Shared Mobile Infrastructure Scheme, during the year 2012 till October 2012. Under this scheme, 7310 (99.42 %) towers were set up by the end ofOctober 2012.

52,628 wire-line broadband connections and 3,347 kiosks have been set up in rural and remote areas under the scheme, during the year 2012 till October 2012 under the Rural Broadband Scheme for expanding provision of Wireline Broadband Connectivity upto village level.

  A subsidy of Rs.330.13 Crore has been disbursed through USOF during the year 2012 till 31.10.2012. A total fund of Rs. 47035.33 Crore has been collected under USOF till 31.10.2012. A total of Rs. 22438.17 Crore of USO fund has been utilized till 31.10.2012 and available potential balance is Rs. 24597 Crore.

Transition to New Internet Protocol (IPv6)

            With the efforts of NT Cell of DoT, all central Departments and State Government have nominated nodal officers for transition to IPv6. All stake holders are sensitized for transition to IPv6 and are gearing up for IPv6 services. Many workshops and seminars were organized during the year 2012 to educate and make aware all the stakeholders about the implementation of IPv6 in their respective areas.

            Establishment of an IPv6 Centre of Innovation Centre has also been approved in NTP-12. This Centre is planned with the vision to provide an environment of end to end IPv6 Services under a single umbrella right from Training, Consulting, Implementation, Research, Standards and Testing. Also, empanelment of certified training organisations for IPv6 certified training courses is under process. To achieve substantial transition to IPv6 in the country in phased and time bound manner, the second road map for IPv6 deployment is in final stage and is to be released shortly.