Mobile economy to add $400 billion to India GDP: GSMA

in 2012, the mobile ecosystem generated approximately 5.3% of the GDP, directly supported 730,000 jobs

India's mobile phone sector could contribute Rs.216 lakh crore ($400 billion) to India's gross domestic product (GDP), creating 4.1 million additional jobs by 2020, Anne Bouverot, director general of the Groupe Speciale Mobile Association (GSMA), said here Wednesday.

GSMA is the global association for mobile companies. It came out with an India specific report "Mobile Economy India 2013", prepared by the GSMA in collaboration with the Boston Consulting Group.

The report revealed that in 2012, the mobile ecosystem generated approximately 5.3 percent of the GDP for India, directly supported 730,000 jobs and an additional two million jobs when points of sale and distributors are included.

However, Bouverot pointed out that the country's regulatory environment is sometimes detrimental to the growth of the industry. "The Indian mobile industry is fast-paced and innovative, but it currently lacks the regulatory environment to support its ambitions," she said.

"An absence of predictable, long-term policies in areas such as the allocation of radio frequencies is acting as a brake on investment," she added.

Regarding spectrum, she said compared to the US and the Europe where cumulatively 600 mega hertz of spectrum is available, in India it is less than half. She emphasised that given India's population density, there should be more spectrum available.

Following international guidelines, the report said the Indian government should allocate and release more harmonised spectrum in larger blocks, which will prevent unnecessary market fragmentation.

Regarding the Universal Service Obligation Fund, the report said India has one of the world's highest universal service levies - five per cent of operating revenues. "The government should look at public-private-partnership or the implementation of projects and seeking alternative funding sources, rather than constraining industry development with ineffective financial mechanisms," she said.

On the recent balanced and evidence-based radio frequency emissions requirements, she said: "The recent regulation adopted by the Indian government goes beyond global standards, increases network costs and can reduce service quality."

"Best practice for radio frequency limits, based on International Commission on Non-Ionizing Radiation Protection (ICNIRP) and endorsed by the World Health Organization, should be followed instead," the director general added.