As the second largest mobile internet base in the world, India has reinforced its place in the global telecom space. The Indian telecom sector is doing pretty well. For instance, it is currently valued at Rs 3,000 billion, with growth projections scaling at a compound annual growth rate (CAGR) of nearly 7-9 per cent by FY24.The nation’s 5G subscriptions have surged to reach approximately 119 million by the end of 2023. Reports also indicate that the subscriptions could reach over 800 million by the end of 2029, which totals up to 65% of all mobile subscriptions in the region. Amid this growth momentum, the government recently brought to life certain sections of the Telecommunications Act 2023.
The 2023 Act is being implemented as a replacement for both the Indian Telegraph Act (1885) and the Indian Wireless Telegraph Act of 1933. The new Act is noteworthy because it strikes a balance between safeguarding citizens’ interests and maintaining national security. At the same time, it is focused on promoting the growth of the telecom sector, as it considers the ongoing technological advancements within the industry. The provision to obtain government authorisation for operating a telecom network, or offering telecom services, or owning radio equipment, will help bring in a more organised approach to the sector. Weeding out of unorganised players could also help overcome challenges such as spectrum theft. Certain sections of the Act can be instrumental for laying down rules which in turn help to set standards. This will also help to define the compliance measures needed to assess telecommunication services, networks and security, among others.
Over the last two decades, India’s telecom services have catapulted, but the potential of its Satcom services need to be harnessed in a better way. The administrative allocation of spectrum for satellite broadband services, under the Act, bodes well for both Indian and international private satellite communications companies, awaiting a green signal to begin their operations. The broadening of the scope of the Department of Telecommunications’ Universal Service Obligation Fund, appears to be a massive step in advancing the adoption of digital services, especially in the underserved rural, remote regions. This can be instrumental in ensuring inclusivity in digital growth.
Furthermore, the provision to support research and development related to telecommunication services, technologies, products, and pilot projects, could make a huge difference. An improvement of R&D funding in alignment with policies that lay down financial incentives for participating members such as system integrators, CSPs and other infrastructure vendors, will be a great move. Launching of a legal framework for a Regulatory Sandbox could prove to be the right step for encouraging innovation and expediting the implementation of new technologies.
With a connected ecosystem of 1.16 billion telecom subscribers and digitally connected enterprises and government, India boasts of extensive use of technology to drive a sustainable and inclusive growth. At this point in time, however, the nation is more at a cusp of a digital revolution in telecom. As 5G services continue to make headway, a strong enabling regulatory environment can help to harness India’s potential to become digital/ telecom superpower.
The partial enforcement of India’s Telecom Act 2023 moves away from licensing and brings in authorisation, rolls out spectrum assignment for satellite broadband services, and initiates a stringent verification process for all players. These are good steps that will further bolster the evolving sector. Since the Act has been formed basis the government's focus on inclusion (Samavesh), security (Suraksha), growth (Vriddhi) and Responsiveness (Tvarit), we can only hope that it helps to lay a strong foundation for the sector to soar.
A version of this article was published in Communications Today Online. The same can be read here
Author
Purushothaman KG
Partner, Head Technology Transformation and Sector Head - Telecommunications
KPMG in India
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