RURAL TELEPHONY
The Village Public Telephone programme has given
a new vision for the growth of rural telephony in the country.
The highest ever Village Public Telephones about 1 lakh in number
were added in one year covering over 5,01,790 villages. 25,336
rural exchanges have been made operational on optical fibre. Wireless
in Local Loop (WLL) is being used to facilitate faster roll out
in rural areas. In order to provide qualitative connectivity,
the second phase of the VPT will focus on the use of data access
and management through the use of fax machines. In a major initiative
to ensure that the benefits of the ongoing Telecom Revolution
is made available to every citizen of rural India, the Prime Minister
launched a Pilot Project namely the ‘Grameen Sanchar Sewak’ scheme.
This pilot project has been conceptualised to provide accessibility
of public
telephone to the rural population at their very
doorstep by using the latest Wireless in Local Loop. Initially,
this pilot project would cover about 8,000 villages in 21 Telecom
Circles in the country engaging the services of 1800 Grameen Dak
Sewaks who will carry the Wireless based telephone in his area
of operation and make available instant telephone communication
facility to the villagers while delivering their letters.
Another key initiative to promote Rural Telephony
came with the establishment of Universal Service Obligation (USO)
and the administration of the Universal Service Fund during the
year. The Universal Service Support Policy came into effect from
1st April, 2002 after consideration of TRAI recommendations
in this regard. The guidelines for implementation were issued
in March, 2002. An Administrator of the Universal Service Fund
was appointed on 1st June, 2002.
REDUCTION IN TARIFFS
The year saw a massive reduction in National
Long Distance and International Long Distance tariffs. There was
a reduction upto 62.5% in the National Long Distance tariffs from
a maximum of Rs.24 per minute to Rs.9 per minute, the highest
ever decrease in tariff. The reduction in the International Long
Distance tariffs has been by nearly 50% from Rs.48 per minute
to Rs.24 per minute. The basic rental for Limited Mobile telephony
has been reduced by more than half from Rs.450/- per month to
Rs.200/- per month. There has been unprecedented growth in the
spread of the Telephone Exchanges which have grown to 35,377.
There has also been a growth of 25% in terms of telephone connections
achieved during the current year. India’s tele-density which has
trebled in the last three years currently stands at 4.5% against
the target of 7% by 2005 and 15% by 2010. Public Call Offices
(PCOs) which stood at 4.2 lakhs on 31st March, 1998
have increased to 11.5 lakhs in 2002.
CELLULAR MOBILE SERVICE
The Cellular Mobile Telephone Service today,
is poised to become a part and parcel of each and every household.
The service has become affordable as a result of steep fall in
tariff. There has been an exponential growth of subscribers and
intensification of competition between operators in the private
sector and those representing Government. According to the Cellular
Operators Authority of India (COAI), on 1st April,
2001, the total cellular subscribers stood at 35,77,095 which
increased to 64,31,520 on 1st April, 2002 and subsequently
increased to 97,30,543 on 30th November, 2002. The
Bharat Sanchar Nigam Limited launched its cellular service namely
‘CellOne’ to cover 850 cities across the country by the end of
this year and would cover all District Centres by 1st
April, 2003. BSNL also launched the brand name for its pre-paid
cellular service ‘Ex-Cell’ and Internet Telephony service ‘WebFone’.
All these developments have augured well for the Industry as it
has led to improvement in quality
and spread of the network. Plans are afoot to
start mobile telephone services in Jammu and other parts of Kashmir
very soon. The Cabinet Committee on Security also lifted the restriction
on the use of Wireless Technology in the entire North-Eastern
region in an effort to usher the telecom revolution in the region.
This move has been viewed positively as due to the difficult terrain
of the region, communication through WLL technology would ensure
connectivity to every village in the region.
DISINVESTMENT OF PUBLIC SECTOR UNDERTAKINGS
25% equity with management control of Videsh Sanchar Nigam Limited
given to Tata’s for a total consideration of Rs.1,439.25 crores.
74% equity of HTL Ltd. given to HFCL for a total consideration
of Rs.55.00 crores.
TECHNOLOGICAL INNOVATION
Technology has also proved the driving force
behind the ongoing telecom revolution. It is the compression and
digitisation techniques as well as broad band access provided
by optical fibre which has accelerated the opening of the telecom
sector to competition whereby market forces are now determining
the nature of the multi operator environment. National information
infrastructure has been built by laying 53,000 RKM optic fibre
cables which provide countrywide linkages through 183 major cities.
Around 1 lakh route Kilometres of optic fibre network has been
added.
Due to the technological innovation in creating
world class infrastructure, India today, has become a preferred
destination for Call Centres. The process for registering Call
Centres has been simplified making India the preferred source
for undertaking IT enabled activities. This has spurred growth
by creating job opportunities in Call Centres whereby over 1 lakh
new jobs have been created. A scheme for setting up of Community
Information Centres (CICs) is also in vogue at 487 block headquarters
in the seven north eastern States and Sikkim for promoting application
of Information Technology for accelerating socio-economic development
of the region. New avenues have been created by allowing Internet
Telephony which has enabled communications from the PC to telephone
abroad and from PC to PC anywhere in the country. With a view
to facilitate customers, Government announced 50% reduction in
night time access charges of internet. This measure was broadly
to promote internet/computer awareness. Total number of Internet
Service Providers who have been permitted to offer Internet Telephony
Services from 1st April, 2002 are 93. Another 24 ISPs
have been given provisional clearance for commissioning of International
Gateways for internet using satellite medium till November, 2002.
During the year, the Government also delicensed Indoor Wireless
LAN in 2.4 GHz to boost the IT sector through wireless connectivity
for computers and internet services for their use in buildings
and campuses.
FISCAL INCENTIVES
India attracts a large amount of Foreign Direct
Investment (FDI) in the telecom sector. The total FDI inflow till
date in the sector has been to the tune of Rs.9,558 crores. The
last two years have accounted for Rs.5,048 crores of the total
FDI inflow in telecom. The sectors where maximum FDI has come
through includes Cellular Mobile Services, Manufacturing and Consultancy,
Basic telephone services, E-mail services and VSAT services. FDI
upto 100% subject to certain conditions is permitted in the following
areas in telecom sector:- ISPs not providing gateways (both for
satellite and submarine cables); Infrastructure providers providing
dark fibre (IP Category I); Electronic Mail; Voice Mail and Telecom
manufacturing sector. FDI upto 74% has been permitted in respect
of the following areas in telecom sector:- ISPs providing gateways
(both for satellite and submarine cables); End to end bandwidth
and Radio Paging Service.
Key fiscal incentives related to the sector were
announced during the course of the year which included: telecom
service operators to pay a reduced uniform Sales Tax of 4%, reduction
in Customs Duty on cellular phones from 26.67% to 14.4%, telecom
services companies allowed the benefit of carry forward of losses
on merger, under Section 72A of the Income Tax Act, basic telephone
including WLL exempted from 1/6 scheme of Income Tax and EHTP
Scheme modified to encourage telecom/IT manufacturing sector.
Today, the country’s telecom network, including
mobile and basic services, is one of the largest growing networks
in the world. India offers world class communication infrastructure
suited to both domestic and external clients. Telephone lines
added to the basic services network over the last 5 years have
grown one and a half times as compared to the preceding five decades.
The current initiatives in the Telecom sector have created the
environment to position telecom growth into the next orbit of
growth. The customer across the length and breadth of the country
is bound to reap benefits of the customisation of services and
products in the sector.
