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Jio effect? Telecom industry is at its weakest, govt will have to step in

Indian telecom industry is at a critical juncture & improvement is crucial for its long-term health

Naveen Kulkarni 

How did it get so bad? The Indian Telecom sector has been under pressure for the last 8 years because of rising competitive and capex intensity. During this period the contribution of telecom services to GDP has declined from 2% of GDP in FY09 to just 1.2% in FY17.

The return ratios for the telecom players has also consistently declined during the period and all the telecom companies do not manage to earn their cost of capital because of continuous investments in spectrum purchases. While competitive intensity has changed with entry and exit of players, the capex intensity has ...

Disclaimer: Views expressed are personal. They do not reflect the view/s of Business Standard.

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First Published: Wed, June 07 2017. 10:11 IST
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