Trai Seeks Growth In Rural India

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The Telecom Regulatory Authority of India (TRAI) has released its recommendations on the growth of telecom services in rural India, which provide for a higher quantitative and qualitative growth.

TRAI said that since tele-density is interlinked with the level of development, the large differential between rural (1.94%) and urban tele-density (31.1%) could not be sustainable.

The Authority believes that without focus on rural areas, sizeable growth in the telecom sector will not be possible.

According to TRAI, the present policies of subsidizing individual replacement would barely be able to achieve rural tele-density targets of 4% by 2010 even after subsidy support of around Rs. 30,000 crores. The Authority said it could not accept such low tele-density in rural areas in 2010 nor such high subsidies to achieve so little.

TRAI said that it was time the policies of reaching telecom to villages were looked upon as a "Universal Service Opportunity" rather than a "Universal Service Obligation". "The time is ripe for such a changeover," said TRAI.

The Authority noted that the Indian rural market has substantial purchasing power if the price of produce is right. Also the expansion of broadband/Internet services provided by Indian ISPs and the immense popularity of cable TV in India far exceed fixed line telephones - a feature not seen anywhere else in the world.

TRAI has also recommended that an alternative approach of facilitating network infrastructure expansion should be adopted. The Authority said that if the proposed scheme were implemented early, then going by its experience of mobile growth in urban areas, India would achieve rural tele-density of around 15% by December 2007 and with urban tele-density of around 43%.

This would take the overall tele-density to 22.98% easily meeting the target of 250 million subscribers set out by the Minister of Communications and IT.