Executive SummaryIndia continued into 2005 to be one of the fastest growing major telecom markets in the world.
The Telecom Regulatory Authority of India (TRAI) described the year ending March 2005 as one of ‘unprecedented growth’ in telecoms services throughout the country.
The growth in mobiles continues to be remarkable, reaching 55 million in early 2005, as mobile tariffs fell by 35% over the previous 12 months.
This ongoing growth came on the back of operators cutting tariffs and setting aggressive network roll-out schedules across the country.
In the meantime, by comparison, growth in the fixed-line sector has been running at only 8%, having reached 46 million by early 2005.There is no doubt that the sweeping reforms introduced by successive Indian governments over the last decade have dramatically changed the nature of the telecommunications industry in the country.
The structure of the market was initially criticised, but the evolution of the market through a series of mergers and takeovers among the mobile operators has since seen a welcome consolidation.
The ‘licensing by circles’ policy is now generally credited with having established a highly competitive and healthy telecoms market.
This is certainly benefiting the country.
With what is now seen as a well regulated commercial environment and with plenty of growth potential, India has become an attractive market for foreign investment.There is something paradoxical about India’s somewhat ambivalent approach to Internet.
In a country where the IT industry is booming, there is considerable enthusiasm amongst the dial-up users.
An estimated 60% of users regularly access the Internet via the country’s more than 10,000 cybercafes.
But when it comes to high-speed broadband access, there is reluctance, especially within the corporate sector, and the take-up rate has been slow.
By early 2005 there were an estimated 700,000 broadband subscribers - a penetration of less 0.1%.
Predictions are that the broadband sector is about to gain some momentum at last.