9 FACTORS PUSHING GROWTH IN ICT SECTOR
ICT connectivity is a key factor for a diverse country like India for creating an inclusive society and fostering holistic development. BK Jha analyses the challenges and prospects of the sector
ICT infrastructure has been playing a significant role in overall socio-economic development globally. India has one of the fastest growing telecommunications sector with over 1.1 billion connections and is the second largest in the world. The communication services available in the country are comparable to the best in the world and major technology shifts like 3G, 4G/LTE have been adopted in line with the developed world. The sector continues to grow rapidly and is amongst the largest contributors to the Indian economy’s GDP and is also one of the significant contributors to FDI in India. The foundation of this landmark growth has been possible only through an extensive Information, Communications and Technology (ICT) infrastructure across the country.
According to a recent report by KPMG on “Building ICT Infrastructure - Connecting the unconnected,” initially ICT infrastructure deployment was largely driven by the need to provide affordable voice telephony services. The growth of
ICT infrastructure sector has been linked to the adoption of a unique business model of passive i.e. Tower infrastructure sharing. The model is meant to drive efficiencies and synergies and the era of multiple operators allowed that to happen very successfully leading to upfront savings in Capex and time to market. This model has been adopted across several geographies globally.
Currently, the country is witnessing an era of explosive growth in data and investments in newer technologies like 5G, Internet of Things (IoT), Machine to Machine (M2M), data centers, mobile applications and cloud technologies are taking place. Additionally, the Indian Government has initiated several
programmes such as Digital India, Smart Cities and BharatNet to ensure data connectivity for the masses and to ‘connect the unconnected’. The success of these programmes and adoption of new technologies is highly dependent on the rapid deployment of reliable and sustainable ICT Infrastructure that provides uninterrupted and quality services at breakthrough speed.
Although there is no single, universal definition of ICT infrastructure, in the present form, it can be defined as a combination of all passive and active networks, fibre and associated equipment needed to provide voice and broadband data connectivity. The key players in this sector include the Telecommunication Service Providers (TSP), Telecom Infrastructure Providers (IP-1s), equipment manufacturers and fiber players. ICT infrastructure can be broadly divided into two types – Core and Enabling infrastructure. Core
infrastructure includes all the hardware needed for network deployment and connectivity. The enabling Infrastructure would include all the software needed to enable the core infrastructure to charge up and work to deliver the services to customers.
“ICT connectivity is a key factor for a diverse country like India for creating an inclusive society and fostering holistic development. The government is committed to create a strong ICT infrastructure and bridging the digital divide in rural and urban India,” said Manoj Sinha, Minister of State for Communications. He also outlined conducive policy and administrative measures including facilitation of spectrum sharing and trading, Right of Way (RoW) policy, creating optic fiber networks, mobile infrastructure and shared mobile towers.
“There is a need for need for deploying eco-friendly infrastructure and using renewable energy for sustainable growth of this sector. We urge the telecom industry for the upgradation of mobile networks,” he added.
RS Sharma, Chairman, Telecom Regulatory Authority of India (TRAI) said, “India has reached unforeseen benchmarks in many areas of technology like software and Aadhar. A new thrust has been laid upon transforming India into
Manoj Sinha Minister of State for Communications, GoI ICT connectivity is a key factor for India for creating an inclusive society. The govt is committed to create a strong ICT infrastructure and bridging the digital divide in rural and urban India
Umang Das Chairman, CII Sub-committee on Telecom Infrastructure The infrastructure is based on cost optimization and rapid infrastructure deployment in far flung areas. The model needs to be expanded to achieve broadband for all. There should be alignment of policies RS Sharma Chairman, TRAI India has reached unforeseen benchmarks in many areas of technology like software and Aadhaar. A new thrust has been laid upon transforming India into a digital economy and a cashless society
a digital economy and a cashless society. All these call for robust base infrastructure on which transformative, newer initiatives can ride.”
The Digital India Mission calls for improving the digital infrastructure, demand of software and services and digital empowerment of citizens. The common duct policy by the TRAI is a measure in that direction.
No doubt, the Government is focus in connecting villages and districts and creating fiber ways, much like highways and roadways. But there is need to work with the state governments in facilitating this all over India, right up to the municipality level.
The Industry gears up
Mritunjay Kapur, National Head of Risk Consulting, KPMG, said that India’s telecom sector has achieved tremendous growth in 2G & 3G, riding on the back of
passive infrastructure. “The sector is poised to set off to even higher growth trajectory with technologies like Internet of Things (IoT), M2M, wireless broadband, digital
payments, which call for a stronger digital infrastructure ecosystem,” he added.
Umang Das, Chairman, CII Committee on Telecom Infrastructure, said, “The infrastructure is based on cost optimization and rapid infrastructure deployment in far flung areas. The model needs to be expanded to achieve broadband for all. There should be alignment of policies between central and state governments, licenses must be reviewed and revisited and issues arising out of GST need to be addressed.”
Connecting Panchayats & TRAI Recommendations
To make broadband a core utility to citizens, the TRAI has recommended to the Government to implement BharatNet in the PPP mode to connect 250000 gram panchayats across the country.
India’s teledensity is at 89 per cent with a tower network of over 450,000 towers and a fiber network of over 1.25 million kilometers Data penetration in India to drive investment of about 70 billion USD in the next 7-10 years’ However, India’s teledensity in rural mobile internet is only 12.98 per cent