1.
INTRODUCTION
Telecommunications is one of the prime support services needed for rapid growth
and modernization of various sectors of the economy. It has become especially
important in recent years because of enormous growth of Information Technology
(IT) and its significant impact on the rest of the economy. India is perceived
to have a special comparative advantage in IT and in IT-enabled services.
However, sustaining this advantage depends critically on high quality
telecommunication infrastructure. Keeping this in view, the focus of Tenth Plan
has to be on the provision of world class telecommunication facilities at
reasonable rates. Provision of telecom services in rural areas would be another
thrust area to attain the goal of accelerated economic development and social
change. Although the telecom network has grown rapidly in recent years, its
growth needs to be accelerated further in the Tenth Plan. It is equally
important to speed up structural changes in this sector in line with trends in
other countries to ensure that telecommunication services are not only made
available on the scale needed to sustain rapid growth in the economy as a whole
but also that their cost are in tune with the expectations of a modernising
economy.
1.2
For a dynamic sector, reforms is a continuous process necessitated by dynamics
of change including technological innovations. The telecom sector in India has
been witnessing a continuous process of reforms since 1991. With the opening of
international long distance services and internet telephony from April, 2002,
the process of liberalisation and opening up the sector for competition is
complete. Convergence of services is a major new emerging area and the telecom
sector will have to address this in the Tenth Plan.
1.3
The New Telecom Policy (NTP) announced in 1999 modified the NTP, 1994 to take
into account the far-reaching technological developments taking place in the
telecom sector globally and to implement the Government’s resolve to make India
a global IT superpower. NTP, 1999 also seeks to solve problems arising out of
the implementation of NTP, 1994. The objectives of the NTP 1999 are to:
-
Make available affordable and effective
communications for the citizens.
-
Strive to provide a balance between the
provision of universal service to all uncovered areas, including the rural
areas and the provision of high-level services capable of meeting the needs of
the country’s economy.
-
Encourage the development of
telecommunication facilities in remote, hilly and tribal areas of the country.
-
Create a modern and efficient
telecommunications infrastructure taking into account the convergence of IT,
media, telecom and consumer electronics and thereby propel India into becoming
an IT superpower.
-
Convert Public Call Offices (PCOs), wherever
justified, into Public Teleinfo centres offering multimedia services like
Intergrated Service Digital Network (ISDN) services, remote database access,
government and community information systems etc.
-
Transform in a time bound manner, the
telecommunications sector to a greater competitive environment in both urban
and rural areas providing equal opportunities and level playing field for all
players.
-
Strengthen research and development (R&D)
efforts in the country and provide an impetus to build world-class
manufacturing capabilities.
-
Achieve efficiency and transparency in
spectrum management.
-
Protect the defence and security interests
of the country.
- Enable Indian telecom
companies to become truly global players.
2.
Ninth Plan Review
2.1
During the Ninth Plan period, a record growth rate of telecom services was
achieved in the country. The network (equipped capacity) grew at an average rate
of about 22 per cent. Growth of both
cellular mobile phones and fixed line
phones has been equally impressive. While private sector concentrated in
cellular mobile phones segment, the growth in the Government sector was
primarily due to fixed line connections. Against the target of providing 237 lakh Direct Exchange Lines (DELs), about 240.55 lakh additional DELs have been
provided during the Ninth Plan. The cellular network has grown from a small base
of 3.40 lakh connections to 64.31 lakh connections by the Plan end. As a result
of this growth, the tele-density has nearly tripled from 1.57 at the beginning
of the Ninth Plan to 4.4 as on March 31, 2002. Details in this regard are given
in the Table below:
Network Expansion – Ninth Plan
(Lines in lakh)
|
|
As on 31.3.1997
|
Net
Addition–Ninth Plan
|
As on 31.3.2002
|
CAGR
|
|
Public
|
Private
|
Total
|
%
|
|
Fixed
|
145.40
|
234.68
|
5.87
|
240.55
|
385.95
|
21.56
|
|
Cellular
|
3.40
|
2.14
|
58.77
|
60.91
|
64.31
|
80.00
|
|
Total
|
148.80
|
236.82
|
64.64
|
301.46
|
450.26
|
24.79
|
|
Tele-density
|
1.57
|
--
|
-- |
-- |
4.4
|
-- |
|
VPTs
|
2.61
|
2.061
|
0.00846
|
2.07
|
4.68
|
12.39
|
The performance of the Public sector units, i.e. Bharat Sanchar Nigam Ltd. (BSNL)
and Mahanagar Telephone Nigam Ltd. (MTNL), has been impressive. Against the
target of installing 185 lakh new connections
in the original Plan (which was
revised to 222.7 lakh in Mid-Term appraisal for BSNL and MTNL) and 237 lakh for
the whole sector including private sector the achievement during the Ninth Plan
is 240.55 lakh connections including contribution of private sector i.e. more
than the target envisaged in the Ninth Plan Document. Ninth Plan also witnessed
the beginning of cellular services by the public sector. MTNL launched its
mobile services in Delhi and Mumbai as the third operator. Details of targets
and achievements of the public sector during the Ninth Plan are given as under.
NINTH PLAN (1997-02)
PHYSICAL TARGETS AND ACHIEVEMENTS- Telecommunications
Name of
Scheme
|
Original Target
|
Revised Targets
|
1997-98
|
1998-99
|
1999-2000
|
2000-01
|
2001-02
|
|
Target
|
Actuals
|
Target
|
Actual
|
Target
|
Actual
|
Target
|
Actual
|
Target
|
Actual
|
|
Switching Capacity (lakh lines)
|
230
|
298
|
36
|
35.18
|
49.3
|
47.89
|
54.7
|
67.17
|
72.35
|
71.3
|
82.46
|
75.83
|
|
DOT
|
200.6
|
273
|
30.8
|
32.3
|
44
|
43.75
|
49
|
63.02
|
67
|
67
|
77.76
|
70.33
|
|
MTNL
|
29.4
|
25
|
5.2
|
2.88
|
5.3
|
4.14
|
5.7
|
4.15
|
5.35
|
4.3
|
4.7
|
5.5
|
|
Direct Exchange
(Lakh lines)
|
185
|
222.7
|
29
|
32.59
|
36
|
37.92
|
45.5
|
49.18
|
52.4
|
59.25
|
72.3
|
57.88
|
|
DOT
|
160
|
200.7
|
24.6
|
28.65
|
31.5
|
35.45
|
40.6
|
45.4
|
48
|
56.29
|
68.3
|
53.07
|
|
MTNL
|
25
|
22
|
4.4
|
3.94
|
4.5
|
2.47
|
4.9
|
3.78
|
4.4
|
2.96
|
4
|
4.81
|
|
TAX (Lakh_lines)
|
18
|
23.06
|
3.25
|
3.14
|
4.5
|
2.06
|
4.53
|
4.8
|
5.15
|
5.12
|
10.1
|
9.97
|
|
DOT
|
15.24
|
18.87
|
2.75
|
2.77
|
3.87
|
2.06
|
4
|
4.03
|
4
|
5.12
|
9
|
9.07
|
|
MTNL
|
2.76
|
4.19
|
0.5
|
0.37
|
0.63
|
-
|
0.53
|
0.77
|
1.15
|
-
|
1.1
|
0.9
|
|
Microwave Systems (‘000kms)
|
90
|
70
|
18
|
17.99
|
19.5
|
14
|
15
|
19.88
|
10
|
21.03
|
7.5
|
14.45
|
|
Optical Fibre System (000 km)
|
140
|
270
|
22
|
23.82
|
35
|
31.77
|
40
|
63.27
|
100
|
55.35
|
126
|
99.02
|
|
VPT (‘000 Nos.)
|
239.16
|
278.87
|
83
|
42.86
|
80.5
|
37.06
|
45
|
33.97
|
70
|
34.22
|
144
|
70.75
|
2.2
The performance of the private sector during the Ninth Plan has been a mixed
one. While it did very well in the expansion of cellular network, the
performance was not encouraging in the fixed line segment. Only about 5.9 lakh
DELs have been installed against the target of 52 lakhs(original) and the
revised target of 14.3 lakh. Constraints like licensing agreements,
unrealistically higher licence fees, revenue share, right of way etc. have been
basically responsible for the slow progress for the private sector.
2.3
For the Government sector, an outlay of Rs.46,442.04 crore was approved for the
Ninth Plan to be financed basically from internal and extra budgetary resources
(IEBR). This included a small budget support component of Rs.44.04 crore meant
for financing the Plan outlay of regulatory bodies like TRAI and Wireless
Monitoring Organisation (WMO) etc. The approved outlay for the Ninth Plan was
only indicative in nature and the Annual Plan outlays were to be fixed on the
basis of resources that might become available during the year. The operational
outlay for the Ninth Plan on the basis of the Annual Plan outlays approved on a
year to year basis works out to Rs.84,783.90 crore including a budget support of
Rs.208.20 crore. As against this, plan expenditure is expected to be
Rs.69,407.62 crore. This gives a utilisation of 163 per cent of the originally
approved outlay and 89 per cent of the approved operational outlay. The
shortfall in expenditure in comparison to the operational outlay was basically
on account of lower expenditure by MTNL and BSNL due to delays in taking up some
new projects and reduction in cost of equipment. On the financing side, the IEBR
generation was lower than targeted (compared to operational outlay) basically on
account of reduced requirement for market borrowings.The shortfall in internal
resources generation by BSNL and MTNL could partly be attributed to tariff
re-balancing.
3. PRESENT STATUS OF
TELECOM NETWORK
3.1
The basic telecom services network has expanded from about 84 thousand
connections at the time of independence to about 385.95 lakh working connections
as on March 31 2002. Basic services network constitutes the bulk of the phones
accounting for about 86 per cent of the total telecom network. The main features
of the present telecom network are given in the table given below:
Status of Telephone Network – As on 31.03.2002
•
Total number of exchanges - 35,023
•
Number of rural exchanges – 26,953
•
Total Fixed Telephone connections – 385.95 lakh
•
Number of Cellular mobile phones – 64.31 lakh
•
Trunk Auto Exchange Lines (TAX) – 34.27 lakh
•
Tele Density - All India - 4.4
•
Number of Village Public Telephones – 4.68 lakh
•
Internet Connections – 38
lakh (as on January 31, 2002)
4. CHALLENGES
FOR THE TENTH PLAN
4.1
With the introduction of competition in the market, the focus of planning needs
to shift from the overall expansion of DELs and network to providing requisite
policy framework for the sector/ market to grow as required and consistent with
the overall policy objectives. In determining the appropriate policy initiatives
and the relevant regulatory framework for this purpose, we need to bear certain
factors in mind. The major factors/trends that merit consideration in this
regard are given below:
Factors and Trends Relevant for Future Policy Initiatives
- Based on global trends and Indian
experience, the rate of growth of cellular mobile services would continue to
be higher for a number of years. Its two important implications are further
lowering of average cost per line and cellular mobile/WLL-M becoming a major
tool of expansion in rural areas.
- The capital requirement for investments
in the next five years are expected to be lower than thepresent cost due to
continuing decline in equipment cost as well as lower network costs due to
competition resulting from entry of infrastructure providers Railways, Power
Grid Corporation, etc. and huge capacity addition by other players.
- A small portion of the subscriber base
provides a large share of call revenue. High revenue subscriber category
would form the core of competition among operators which may lead to a fall
in the tariffs applicable to this type i.e. long distance calls. As a
result, long distance tariffs may be even lower than those specified by the
regulator.
- Margin of surplus will decline over
time due to competition. However, the break-even revenue per subscriber will
also be lower due to decline in costs.
- Data services are expected to grow much
faster than voice telephony. This underlines the need in due course to focus
on broad-band linkages to enable the provision of these services at the
required rate.
- Due to large uncovered areas in rural
and remote regions of the country which are also expected to be low paying
as well, the commitments on account of USO are likely to be large.
- The trend towards convergence of
services may lead to major changes in the structure of industry and markets.
4.2
Telecommunications is one of the fastest growing sectors in India. However,
viewed in the context of global growth patterns and indicators, the sector is
still in the early stages of development. Our tele-density was only 4.01 as
compared to the global average of 32.78 (December, 2001) and 24.98 achieved by
China. The comparative position of teledensity in a cross section of countries –
both developed and developing – is given below.
Telecom Development - International Comparison
( As on December, 2001)
Country
|
Population
|
GDP per capita
|
DELs (Fixed)
|
Cellphones
|
Total Phones
|
Tele-density
|
|
|
(In crore)
|
(US$)*
|
(In lakh lines)
|
(In lakh lines)
|
(In lakh lines)
|
|
|
USA
|
28.59
|
36211
|
1900
|
1270
|
3170
|
110.88
|
|
UK
|
6.01
|
23694
|
353.26
|
470.26
|
823.52
|
137.02
|
|
Australia
|
1.93
|
19897
|
100.6
|
111.69
|
212.29
|
109.99
|
|
Brazil
|
17.18
|
3500
|
374.31
|
287.46
|
661.77
|
38.52
|
|
Mexico
|
10.04
|
5807
|
137.73
|
217.57
|
355.3
|
35.39
|
|
S. Africa
|
4.38
|
2882
|
49.69
|
91.97
|
141.66
|
32.36
|
|
Egypt
|
6.46
|
1424
|
66.5
|
27.94
|
94.44
|
14.63
|
|
Japan
|
12.73
|
34337
|
760
|
748.19
|
1508.19
|
118.45
|
|
Malaysia
|
2.38
|
3838
|
47.38
|
71.28
|
118.66
|
49.86
|
|
China
|
129.61
|
834
|
1790.34
|
1448.12
|
3238.46
|
24.98
|
|
Pakistan
|
14.5
|
425
|
34
|
8
|
42
|
2.9
|
|
India
|
102.7
|
455
|
347.32
|
64.31
|
411.63
|
4.01
|
|
Asia
|
360.67
|
2354
|
3911.79
|
3366.14
|
7277.93
|
20.17
|
|
World
|
607.91
|
5274
|
10460.88
|
9462.97
|
19923.85
|
32.78
|
Source
: World Telecom
Development Report, 2002
* Figures of per
capita income relate to the year 2000
TELE-DENSITY – INTERNATIONAL COMPARISON (31.12.2001)
|
Country
|
Main Telephone Lines
(in lakh)
|
Tele-density
|
|
|
1995
|
2001
|
CAGR %
|
1995
|
2001
|
CAGR %
|
|
USA
|
1597.35
|
1900
|
2.9
|
60.73
|
66.45
|
1.5
|
|
UK
|
294.11
|
353.26
|
3.1
|
50.18
|
58.8
|
2.7
|
|
Australia
|
89
|
100.6
|
2.1
|
49.25
|
52.02
|
0.9
|
|
Brazil
|
132.63
|
374.3
|
18.9
|
8.51
|
21.78
|
17
|
|
Mexico
|
88.01
|
137.73
|
7.7
|
9.39
|
13.72
|
6.5
|
|
S.Africa
|
40.02
|
49.69
|
3.7
|
10.14
|
11.35
|
1.9
|
|
Egypt
|
27.16
|
66.5
|
16.1
|
4.67
|
10.3
|
14.1
|
|
Japan
|
622.92
|
760
|
3.4
|
49.61
|
59.69
|
3.1
|
|
Malaysia
|
33.32
|
47.38
|
6
|
16.57
|
19.91
|
3.1
|
|
China
|
407.05
|
1790.34
|
28
|
3.3
|
13.81
|
26.9
|
|
Pakistan
|
21.27
|
34
|
8.1
|
1.67
|
2.35
|
5.8
|
|
India#
|
119.78
|
347.32
|
19.4
|
1.29
|
3.38
|
17.4
|
|
Asia
|
1816.88
|
3911.79
|
13.6
|
5.46
|
10.85
|
12.1
|
|
World
|
6892.51
|
10460.9
|
7.2
|
12.29
|
17.21
|
5.8
|
Source :
World Telecom
Development Report 2002.
# :
Tele-Density works
out to 4.4 on the basis of total tephone connections of 450.26 lakh including
64.31 lakh
collector
connections (31.03.2002)
The status of teledensity along with other indicators like
per capita income, number of PCs, Internet users etc. for these countries may be
seen in as under:
TELECOM DEVELOPMENT – INTERNATIONAL COMPARISON
(As on Dec. 2001)
|
Country
|
Population
|
GDP per
|
DELs (Fixed)
|
Tele-density
|
No. of PCs
|
Internet Users
|
|
|
(In crore)
|
capita (US$)*
|
(In lakh lines)
|
|
per 100 persons
|
per 10,000 persons
|
|
USA
|
28.59
|
36211
|
1900
|
66.45
|
62.25
|
4995.1
|
|
UK
|
6.01
|
23694
|
353.26
|
58.8
|
36.62
|
3995.01
|
|
Australia
|
1.93
|
19897
|
100.6
|
52.02
|
51.71
|
3723.05
|
|
Brazil
|
17.18
|
3500
|
374.3
|
21.78
|
6.29
|
465.58
|
|
Mexico
|
10.03
|
5807
|
137.73
|
13.72
|
6.87
|
362.23
|
|
S. Africa
|
4.38
|
2882
|
49.69
|
11.35
|
6.85
|
700.58
|
|
Egypt
|
6.45
|
1424
|
66.5
|
10.3
|
1.55
|
92.95
|
|
Japan
|
12.73
|
34337
|
760
|
59.69
|
34.87
|
4547.1
|
|
Malaysia
|
2.38
|
3838
|
47.38
|
19.91
|
12.61
|
2394.96
|
|
China
|
129.61
|
834
|
1790.34
|
13.81
|
1.93
|
260
|
|
Pakistan
|
14.5
|
425
|
34
|
2.35
|
0.41
|
34.49
|
|
India#
|
102.71
|
455
|
347.32
|
3.38
|
0.58
|
68.16
|
|
Asia
|
360.67
|
2354
|
3911.79
|
10.85
|
3.31
|
437.49
|
|
World
|
607.91
|
5274
|
10460.9
|
17.21
|
8.42
|
823.24
|
Source :
World Telecom
Development Report 2002.
# :
Tele-Density works
out to 4.4 on the basis of total telephone connections of 450.26 lakh including
64.31 lakh
collector
connections (31.03.2002)
* :
Figures of
population and income (GDP) relate to year 2000.
4.3 The sector also needs, especially in terms of broad-band, to
expand at substantially higher rates to meet the needs of related sectors like
IT, I & B and other sectors of the economy. Keeping this perspective in view,
the sector needs to be treated essentially as an infrastructure sector for the
next decade or so. Once the required tele-density is achieved and the necessary
support network has been created, the sector could be treated as service sector.
4.4
With a view
to ensuring optimum growth in the coming years, Government’s broad policy of
taxes and regulation for the telecom sector is a promotional one. Mopping
up of resources or revenue generation by the Government should not be a
determinant of the policy governing the sector. The incidence of licence fees in
the form revenue share and spectrum charges has to be guided by this principle.
4.5 The presence
of multiple operators in various sectors implies a need to focus on the
conditions that will enable these operators to function smoothly. Specific
planning would be required to prepare the grounds for a multi-operator system to
develop and the subscriber base to expand without impediments.
4.6 The Radio
Frequency (RF) spectrum is a scarce natural resource. In accordance with
international treaties, it has to be shared among a very large number of radio
communication services and users – defence, civil, Government and private –
based on the principles of co-existence and most efficient use. The increasing
share of cellular mobile in total number of telephones points to a need for
greater focus on the policy for allocating frequency spectrum. In addition to
cellular mobile phones, which will have a large number of lines by the end of
the Tenth Plan, frequency spectrum will be required also for the WLL used for
providing basic services. The advent of new technology will also
pose a significant challenge for the planners of radio
spectrum. The increasing adoption of wireless technologies and the need to align
with international standards would mean that there will be a need to address the
shortage of wireless spectrum and to reconcile competing demands in certain
frequency bands. The policy governing spectrum allocation and licencing has to
be so designed that this scarce resource is used optimally and does not become a
constraint for growth.
4.7
Though about 70 per cent of India lives in the villages and rural areas account
for about 30per cent of the GDP, the development of telecom facilities in these
areas is far from satisfactory. The tele-density in rural areas is only 1.14
against 10.16 in the urban areas. Viewed from the general accessibility point of
view also, about one-third of the total villages in the country are yet to be
connected by basic telecom facility. As per the NTP-1999, the Government is
committed to provide voice and low speed data services to all the remaining
villages by 2002. With the corporatisation of DoT’s network by creating BSNL,
rural telephony is no more primary responsibility of the public sector.
4.8 The public
sector will have to continue to play a significant role in the provision of
basic telecom services during the Tenth Plan. Out of about 828 lakh new
connections envisaged to be provided during the Tenth Plan, the public sector
units i.e. BSNL and MTNL are expected to provide 395.23 lakh additional
connections. This assumes no budgetary support from the Government to BSNL for
expansion of network in the rural areas. However, depending upon the
availability of additional resources through USO support and other sources,
public sector may be in a position to achieve much higher targets for major
services during the Tenth Plan period. Cellular services are also expected to be
the corner-stone of the public sector expansion plans in the Tenth Plan. As per
the plans drawn by the company, BSNL is expected to be a major national player
in cellular services.
4.9
Private investment is also expected to play a leading role in the expansion of
telecom services during the Tenth Plan. In the area of value added services, the
private sector would continue to play the dominant role. The quantum of
investment by the private operators would basically get determined by the rate
of return on such investments – both basic as well as value added services.
Foreign Direct Investment (FDI) has also a major role to play in supplementing
the resources of the domestic private sector as the scale of investment
envisaged is large.
5.
OBJECTIVES AND TARGETS OF THE TENTH PLAN
5.1 The Tenth plan policies and programmes are guided by the
basic goal of creating a worldclass telecom infrastructure in order to meet the
requirements of IT based sector and needs of a modernising economy on the least
cost basis. Ensuring value for money to the consumers and easy and affordable
access to basic telecom services to everyone and everywhere would be the other
goal of policies to be pursued in Tenth Plan. The major objectives envisaged for
the Tenth Plan are:
(i)
Affordable and effective communication facilities to all citizens.
(ii)
Provision of universal service to all uncovered areas, including rural
areas.
(iii)
Building a modern and efficient telecommunications infrastructure to meet
the convergence of telecom, IT and the media.
(iv)
Transformation of the telecommunications sector to a greater competitive
environment providing equal opportunities and level playing field for all the
players.
(v)
Strengthening R&D efforts in the country.
(vi)
Achieving efficiency and transparency in spectrum management
(vii)
Protecting the defence and security interests of the country.
(viii)
Enabling Indian telecom companies to become truly global players.
5.2 The basic thrust of the Tenth Plan would be to provide world
level services at affordable prices. With corporatisation of DOT’s network, the
network expansion/roll-out plans of both Government and private sector would be
guided by the demand of various services. In line with the broad objectives of
the NTP, 1999 and the objectives envisaged for the Tenth Plan, the following
specific targets are envisaged for the telecom sector for the Tenth Plan:
-
To endeavour to
make available telephones by and large on demand by end of 2002-03 and sustain
it thereafter.
-
To achieve an
overall teledensity of 9.91 by 31st
March 2007.
-
Achieve telecom
coverage of all villages in the country by December 2002 and provide reliable
transmission media in all rural areas.
-
Provide reliable
media to all exchanges by the end of March, 2003.
-
Provide
high-speed data and multimedia capability using technologies including ISDN to
all towns with a population greater than two lakhs by the end of March, 2003.
6.
EXPANSION OF NETWORK DURING THE TENTH PLAN
6.1 The NTP, 1999 provides the basic framework for the future
development and growth of the telecom sector in the country. One of the major
objectives of the Policy is to make telephones on demand by the year 2002 and
sustain it thereafter so as to achieve a teledensity of 7 by the year 2005 and
15 by the year 2010. Keeping in line with the above goals of teledensity, the
country need to achieve an overall teledensity of 9.91 by the Tenth Plan end
i.e. March, 2007. To achieve the above target of teledensity, about 650 lakh
additional connections may have to be provided during the Tenth Plan. Working on
a different assumption of achieving a tele-density target of 11.5 by March,
2007, the Working Group on Telecom Sector for the Tenth Five Year Plan had
recommended that 817.10 lakh new connections needed to be provided during the
Tenth Plan. Keeping in view the present trend of growth, the Plans drawn up by
the public sector and the availability of funds, the projections of the Working
Group seem to be on the higher side. Taking the above factors into account, the
goal of achieving teledensity target of 9.91 by March, 2007 seems more
realistic. The distribution among cellular, fixed and WLL based limited mobility
lines out of the net addition during the Plan period would depend upon the
emerging behaviour of the market, availability of technological innovations and
options and relative prices of equipment. As per the initial Plans drawn by
Bharat Sanchar Nigam Ltd. (BSNL) and Mahanagar Telephone Nigam Ltd. (MTNL), the
public sector is envisaged to provide about 395 lakh additional connections.
This implies that remaining connections i.e. about 255 lakh would have to be
provided by the private sector of the performance of the private sector is more
encouraging higher target of tele density could be achieved.
6.2 Bharat Sanchar Nigam Ltd. (BSNL)
Bharat Sanchar Nigam Ltd. (BSNL)
came in to existence on 1.10.2000 as a result of the reorganisation of the
erstwhile Department of Telecom. With this, the reforms process of separation of
policy formulation from service provision and regulation has been completed.
This reorganisation had two important implications for BSNL i.e.
(i)
BSNL has to act henceforth as a commercial entity; its investment
policies among other things to be guided by profits/ purely by commercial
consideration.
(ii)
BSNL would be subjected to additional financial liabilities like
corporate tax, licence fees, payment of dividend etc. which were not applicable
to erstwhile DOT
Based on the resources availability of the company, it plans
to provide 367.67 lakh new connections during the Tenth Plan. Keeping in line
with the projected demand for mobile services, the main focus of the company is
envisaged to be on expansion of cellular mobile services as the third operator
in various circles. The following table gives the broad details of expansion
programme envisaged by the Company during the Tenth Plan:
Expansion of
Network - BSNL
(In lakh lines)
|
Types of Phones
|
Urban
|
Rural
|
Total
|
|
Fixed
|
80
|
0.9
|
80.9
|
|
WLL
|
51
|
11.93
|
62.93
|
|
Mobile
|
222
|
1.84
|
223.84
|
|
Total
|
353
|
14.67
|
367.67
|
6.3 Mahanagar Telephone Nigam Ltd (MTNL)
MTNL had enjoyed monopoly till 2000 in the two metro cities
of Delhi and Mumbai, where it operates. Since then the private operators have
started providing basic services in Mumbai and are expected to do the same soon
in Delhi. Increased competition from private operators is expected during the
Tenth Plan. To maintain its position as a major player in Mumbai and Delhi, MTNL
envisages to expand its cellular network in a big way during the Tenth Plan.
Expansion of internet services and introduction of IT related services is
another major element of company’s overall strategy of growth and competition.
As per the plans drawn up by the company, 27.56 lakh additional telephone
connections are expected to be provided during the Tenth Plan including 11.57
lakh cellular phones. The entire plan outlay of the company is envisaged to be
financed out of internal and extra budgetary resources.
6.4 Centre for Development of Telematics (C-DoT)
C-DoT is the main public sector agency engaged in R&D
activity in the Telecom sector. It has been a leader in the development of rural
exchanges which have performed exceedingly well under tough conditions. C-DoT
technology constitutes more than 40per cent of the total lines operative in
Indian telecommunications network. C-Dot licence manufacturers are exporting the
technology switches to other countries having conditions similar to those in
Indian rural areas.
During the Tenth Plan, the thrust of CDoT’s research plan
would be the development of cost effective technologies providing services and
features at par with those being offered by other global players. Development of
products to cater to the needs to broad-band fixed and mobile subscribers access
system, as well as high band with backbone systems would be an important part of
the strategy for the Tenth Plan. Some of the major areas of thrust are:
•
Intelligent Network Services
•
GSM Personal Communication Services
•
Third Generation Mobile Communication System
•
Ka Band Satellite Communications
•
Cell and Packet Switching Technologies for Voice and Data
Convergence
•
Ultra High Bit Rate Network Backbone
•
Expansion Planning of Existing Wireline Network 8.5.67
Till September, 2000, the plan outlay of CdoT was financed
out of I R generated by DoT. With the carving out of BSNL as a separate
corporate entity, this mode of financing is no more available and the plan
outlay is required to be funded through budgetary support.
R&D activity in any sector is very vital for ensuring future
growth and hence needs to be supported fully. However it may be mentioned that
as one of the major beneficiaries of the R&D of CDoT, the industry needs to be
fully associated in financing its activities. Besides, C-DoT needs to focus more
on generating internal resources through royalty, consultancy etc. to reduce its
dependence on Government support.
7. THE PATH
AHEAD
7.1 The Tenth Plan would endeavour to build a modern and
efficient telecom infrastructure with a view to provide world class
telecommunications facilities at affordable rates, meet the needs of convergence
of telecom, IT and media and universal service to all uncovered areas. To
achieve the above
goals, the
major initiatives/action points envisaged for the Tenth Plan are :
(i)
To achieve a target of tele-density of 9.91 by March, 2007, about 650
lakh new telephone connections need to be provided during the Plan Period.
(ii)
The telecom sector needs to be treated as an infrastructure sector for
the next decade or so in order to achieve the targets of teledensity in line
with the objectives laid out in the NTP, 1999. This is envisaged also to help
achieving substantially higher rate of growth of broadband to meet the
requirements of other sectors of the economy especially Information Technology
and Entertainment.
(iii)
Government’s broad policy of taxes and regulation for the telecom sector
has to be promotional in nature with a view to ensuring optimum growth in the
coming years.
(iv)
Ensuring fair and timely interconnection in the multi-operator scenario
is one of the major inputs for sustaining high growth.
(v)
The policy governing spectrum allocation and licencing has to be so
designed that this scarce resource is used optimally and does not become a
constraint for growth. Spectrum pricing need to be based on relative demand and
supply over space and time in a dynamic manner and should promote introduction
of spectrum efficient technology. A significant chunk of available spectrum is
being used by defence, police and para military forces.
(vi)
Adequacy of funds has to be ensured for effective implementation of the
USO.
(vii)
The policy governing development of rural telecom services need to be
promotional in nature with a view to boost teledensity in these areas in line
with the objectives of NTP, 1999.
7.2 An outlay of Rs. 86984.00
crore including the budgetary support of Rs. 1500 crore has been approved for
the Telecommunications sector for the Tenth Plan.
MID-TERM APPRAISAL