1. LIBERALISATION ERA FOR INDIAN TELECOM REGULATION INDUSTRY WORKSHOP by Rakesh Agrawal, ITS (Retd,) Director, CMAI Former Advisor Technology, DOT Government of India 24 th August, 2009 www.cmai.asia ASTAP

2. 2www.cmai.asia CMAI the Indian trade and business association offers one window service for information dissemination, guidance on setting up businesses in India. It also offers consultancy services on turn key basis through its member companies CMAI… your dependable partner in India www.cmai.asia

3. SCENARIO IN EARLY INDIA In 1975, the Department of Telecom (DoT) was separated from P&T.Department of TelecomP&T DoT was responsible for telecom services in entire country until 1985 Mahanagar Telephone Nigam Limited (MTNL) was carved out of DoT to run the Telecom services of Delhi and Mumbai. Mahanagar Telephone Nigam LimitedDelhiMumbai In 1990s the telecom sector was opened up by the Government for private investment as a part of Liberalisation- Privatization-Globalization policy.Liberalisation PrivatizationGlobalization

4. Total demand Waiting List Del India Teledensity 1.29 (1995) 3.38 (2001) SUPPLY AND DEMAND – 1981 TO 2001

5. Government initiatives in Telecom 1992- Private players were allowed in Value Added Services National Telecom Policy 1994 Private sector to Supplement Government Provide world class telecom service at affordable cost Establishment of Telecom Regulatory Authority of India (1997) New Telecom Policy 1999 Transition from Fixed license fee to Revenue Share Introduction of Free Competition Technology Neutral Licenses

6. Govt. initiative in Telecom…… Establishment of Telecom Dispute Settlement Appellant Tribunal (2000) BSNL was established by DoT Opening of National & International Long Distance- 2002 Establishment of Universal Service Obligation Fund Reduction of licence fees-2002 2003- Calling Party Pays (CPP) was implemented 2003- Unified Access Licensing (UASL) regime introduced 2003- Reference Interconnect order was issued

7. Government Initiative Cont.. 2004-Intra-circle merger guidelines established 2004-Broadband policy formulated—targeting 20 million subscribers by 2010 2005-Attempted to boost Rural telephony 2005-Number portability proposed (Expected Dec 2009) 2005-FDI limit was increased from 49 to 74 percent 2007-3G Spectrum Auctioning process. BSNL/MTNL Launched. 2008 Decision on 3G services (awaited)

8. POLICY INITIATIVES HAVE FUELLED GROWTH All points of inflexion have yielded positive benefits for the industry as well as the customers

9. GROWTH TREND OF WIRELESS SUBSCRIBERS

10. INDIAN TELECOM TODAY World’s fastest Growing Telecom Market – 10-15 Mn. subscriber addition per month Second largest in the world after China 430 Mn. Subscribers, Including wireless = 392 Mn. Retail Market for Mobile Phones, accessories etc. is worth over US$ 15 Billion and growth 15% Internet Subscribers 10 Mn. Internet Mobile 31.30 Mn. Broadband 6.22 Mn.

11. 2008-2009: 13.54mn INTERNET SUBSCRIBERS

12. Urban & Rural Teledensity in India TELEDENSITY March 2009: About 38%

13. The Future… 2010 Telephone subscribers: 500 Mn. by 2010, 650 Mn. By 2012 and 800 Mn. By 2015 Add. Investment required 25 Bn. US $ by 2010 and 30 Bn. US $ by 2015 PC Sales: 25 Mn.; installed base 65 Mn. by 2010 ITES & Software exports: USD 60 Bn. by 2010 40 Mn. new internet connection; 20 Mn. broadband by 2010 Over US $10 Bn. investment in e-governance and National ID Card by 2010 2015: Total expected Market US $ 320 bn; Domestic production US $ 150 bn

14. Source : CII Broadband report Wireless Subscribers Fixed Line Subscribers Millions Today 350 Million Despite the global economic slowdown, India’s Telecom Market continues to sizzle India is the fastest growing cellular market in the world Has become the 2 nd largest market after china earlier this year India is adding 12-15 Million new wireless subscribers every month Broadband subscribers beginning to pick up Expected to reach About 50% tele- density by 2010 with 500 Million Subscriber India’s telecom Market is booming Despite the economic slowdown, India continues to add 10-15 Million wireless users every month India’s telecom Market is booming Despite the economic slowdown, India continues to add 10-15 Million wireless users every month

15. India Telecom Demand Expected to reach US $ 18 Billion this year Source: TEMA Over $100 Billion worth of telecom equipment is needed during next five years. Thanks to the current policy regime, Telecom equipment production is increasing. If the manufacturing industry continues to grow, over 50% of the demand will be met by local production, which is global benchmark $18 Billion $16 Billion$12 Billion$10 Billion IMPORTS PRODUCTION EXPORTS

16. Page 16 India Telecom Manufacturing Industry Expected to cross $ 10 Billion this year Source: TEMA For the First time, the equipment production is expected to cross Rs. 50,000 Crores this year. The expected production boom will generate employment for at least 10 Million (4 mn Direct; 6 mn Indirect) by year 2010 Local Production will Service a major market of 500 Million Subs.

17. India Telecom Exports Expected to cross $ 2 Billion this year Source: TEMA Exports have taken off in a big way since 2007-8. This year the Telecom exports are expected to cross Rs. 10,000 Crores The Telecom Export Council set up recently by the Government is in the final stage of setting up Government has set up a governing council to guide promotion of Telecom exports

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