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February 23, 2001                                       Feedback  

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Telecom sector gallops ahead: Survey


Having shed much flab after the corporatisation by the government, the Department of Telecom will focus on addressing urgent issues such as policy formulations, licensing, wireless spectrum management, boosting investor confidence and speedier development of a multitude of services.

The functions of the Department of Telecom Services (DTS) and Department of Telecom Operations (DTO) are being taken up by a newly- formed corporate entity, the Bharat Sanchar Nigam Ltd (BSNL) from October one, 2000. The company has an authorised capital of Rs 100 billion with a paid up capital of Rs 50 billion.

This initiative is expected to provide a level playing field in all areas of telecom services between government operators and private operators.

The Economic Survey, 2000-2001 says that during April-December 2000 there was a growth of 29.8 per cent in terms of new connections. The combined telecom network of the BSNL and the MTNL with a capacity of 35 million lines and 28.4 million working connections witnessed an increase in switching capacity by 40 per cent.

More than 4.9 million new connections were provided in 1999-2000.

The value of equipment production increased to Rs 107.60 billion in 1999-2000 from Rs 100 billion in 1998-99. The telecom exports increased to Rs 37.47 billion in 1999-2000 from Rs 29.09 billion in 1998-99.

Cellular services have been started in all metro cities and select cities in 18 telecom circles. After the MTNL introduced it cellular service in Delhi and Mumbai there has been a crash in tariffs with private operators following suit.

Now the BSNL has decided to introduce the cellular mobile service as a pilot project in five telecom circles covering 27 cities in Andhra Pradesh, Tamil Nadu, West Bengal, Bihar and Punjab. Thereafter, the services will be expanded in a phased manner all over the country.

The share of the cellular mobile subscribers has grown at a rapid pace.

As per the New Telecom policy, every village is to be provided with one public telephone and is expected to be completed by the end of the ninth five-year plan. The BSNL as well as the licensed private operating companies will accomplish this task the survey says.

The New telecom policy, 1999 has initiated the opening up of the National Long Distance Service to private operators without any restriction on the number of operators.

Companies registered in India are being licensed to plan, install, operate and maintain the basic services.

To promote greater competition there will now be a multitude of operators. As against the existing arrangement of two private operators and BSNL or MTNL as third operator in cellular operator and duopoly in basic telecom service there will be multiple operators.

Applications were also being invited from Internet Service providers for setting up of submarine cable landing stations for international gateways for internet.

BSNL is also in the process of establishing a National Internet Backbone (NIB) for carriage of Internet traffic.

The terms and conditions of license agreement for providing Global Personal Communications by Satellite (GMPCS) services are under finalisation, taking into account the recommendations of TRAI on entry fee, quantum and structure of license fee as revenue share and other terms and conditions. Five license agreements with four companies have been signed. Licnese for voice-mail and audiotext have been granted on non exclusive basis and the services are operational in Bombay, Kalyan and Bangalore.

To encourage basic telephony, the DOT decided not to increase the rental and call charges for the rural subscribers and low calling urban subscribers with calls upto 200 per month.


Economic Survey 2000-2001
Budget 2001

Read the Economic Survey

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