Telecom sector to get $40 bn by '10

The domestic telecommunications sector is likely to get an additional $40 billion in investments by end of 2010, of which $15 billion would come in by the end of 2007.

An investment of an additional $25 billion would come in by 2010, according to a paper by the ministry of communications and IT.

The government was expecting an additional 250 million telephone, 18 million Internet and nine million broadband connections in 2007. This would require an additional investment of $15 million, the ministry said in a paper submitted to Rajya Sabha.

By 2010, there would be 500 million telephone connections, with 40 million Internet connections and 20 million broadband connections. This will require an additional investment of $25 billion in the next three-year period, it said.

As on September 2006, the country's total telecom subscribers stood at around 171 million, representing a 15.4 per cent tele-density. The total investments in the telecom sector till date are estimated to around $25 billion.

It has over 136 million mobile subscribers as on November 30, and was recording a net addition of over 5 million every month.

According to analysts, the government's 250 million subscriber target looks "achievable", while the calculation of investment based on this growth also looks "feasible".

Some of these investments would be used for setting up base transceiver stations (BTS) or cell sites, an infrastructure required to offer mobile calls.

The country requires an additional 2 lakh BTSes in the next couple of years, while at present there is an estimate 90,000 towers in the country.

According to the Telecom Regulatory Authority of India, "The capital costs for creating new infrastructures are formidable."

It is estimated that 60 per cent of rollout costs of a mobile service is towards setting up of passive infrastructure and only 40 per cent is earmarked for active infrastructure and electronics.