Economic Survey: Telecom reforms to spur liquidity, investments in 5G

The telecom sector reforms are poised to boost 4G proliferation, infuse liquidity and create an enabling environment for investment into 5G networks, according to Economic Survey 2021-22.

In the wake of "outstanding performance" of the telecom sector in meeting COVID-19 challenges and with a huge surge in data consumption due to online education and work from home, the reform measures will bolster proliferation and penetration of broadband and telecom connectivity, said the Economic Survey tabled in Parliament on Monday.

In addition to telecom infrastructure expansion, a slew of measures have been taken to bring about reforms, the survey said, outlining the structural and procedural reforms undertaken in the Indian telecom sector that represents the world's second-largest telecommunication market.

"The reforms are also expected to boost 4G proliferation, infuse liquidity and create an enabling environment for investment in 5G networks," it added.

A strong and responsive regulatory framework has kept service access at reasonable prices, with the government taking further measures to ensure fair competition among service providers with the view to benefit the consumers.

Telecom is among the most powerful sectors impacting the social and economic development of a country, the survey said observing that the relevance of the sector has "increased immensely".

The same is reflected in key metrics, such as growth in total telephone subscriber base, steady increase in internet subscribers, and broadband connections.

In the last few years, the telecom sector in India has become data-driven following reducing costs of data due to the fierce competition in the sector. This has boosted data usage further.

A case in point is the average wireless data usage in a gigabyte (GB) per data user per month that has increased "tremendously" to a whopping 14.1 GB per month in Q1 FY22, from just 1.24 GB per month in Q1 FY18.

The number of mobile towers has risen substantially to reach levels of 6.93 lakhs towers in December 2021, "reflecting that the telecom operators have well realised the potential in the sector and seized the opportunity to build up an infrastructure that will be fundamental in boosting the government's Digital India campaign".

Listing out the progress on the connectivity front, it said that under the flagship BharatNet project, 5.46 lakh km optical fibre cable has been laid, a total of 1.73 lakh Gram Panchayats (GP) have been connected by Optical Fiber Cable (OFC) and 1.59 lakh Gram Panchayats are service-ready on OFC, as of September 27, 2021.

A boost to the telecom infrastructure is also being given under the aspirational district scheme while thrust on the provision of submarine optical fibre cable infrastructure will spur high-speed internet and broadband connectivity.