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India - Telecommunications Infrastructure and Forecasts

Attention: There is an updated edition available for this report.

India has a huge national telecommunications network. With fixed-line penetration falling below 3% coming into 2012, the country has nevertheless achieved a remarkable coverage, 98% of the population having some form of access to a telephone. Despite the heavy investment in telecoms infrastructure over the last decade, servicing the huge population has presented major difficulties. Even the booming mobile phone market had almost 80% penetration by early 2012. As well as its huge national network, India’s investment in telecommunications infrastructure over the last decade has extended to a heavy involvement in the international market. Under the leadership of international operator VSNL/Tata Indicom the country has been assembling an extensive infrastructure of gateways, satellite earth stations and fibre optic submarine cables. Billions of rupees continue to be invested in a combination of submarine cables and microwave systems to satisfy India’s demand for international bandwidth and high-quality connectivity. Most significantly, VSNL/Tata Indicom has become a serious international player on the back of a series of acquisitions and good strategic moves.

Investment in infrastructure has to a significant extent depended on India attracting foreign investment into the sector. The attractiveness of India to foreign telecom operators took a nosedive in 2012 when the so-called 2G scandal resulted in a Supreme Court ruling that saw 122 mobile licences cancelled. The subsequent regulatory uncertainty can only be described as chaotic; the matter was still running its course in the second half of the year.

This report provides an update on telecoms infrastructure in India as the government and the operators push forward on a number of fronts to speed up the roll-out of services to the wider population. It also provides an overview of the submarine and satellite systems that have been put in place in recent times as the country addresses its international bandwidth needs.

Key developments:

The mobile market continues to receive the bulk of the capital expenditure as the operators build out their mobile infrastructure; national optical fibre network project has been launched; the shakeout from the so-called 2G scandal was continuing to bring uncertainty to the telecom market and was certain to impact on investment and infrastructure development; fixed-line subscriber numbers continue to decline; the total number of ‘connected villages’ in India has passed 98%: ISRO communications satellite, GSAT-10, launched in September 2012.

Companies covered in this report include:

Bharti Airtel, Idea/Spice, Reliance Communications, Tata Teleservices, Vodafone Essar, Bharti Telenet, Reliance Infocomm, Tata Teleservices, Tulip Telecom, Videsh Sanchar Nigam Ltd (VSNL), Tata Indicom, Bharat Sanchar Nigam Ltd (BSNL), Mahanagar Telephone Nigam Ltd (MTNL), Quippo Telecom.

1. Synopsis
2. National infrastructure
2.1 Overview
2.2 Statistics
2.3 Forecasts - fixed-line services – 2015; 2020
2.4 Background to network development
2.5 Infrastructure sharing
2.6 Rural and regional networks
2.6.1 Universal Service Obligation Fund (USOF)
2.6.2 Infrastructure sharing in rural areas
2.6.3 Village Public Telephones (VPTs)
2.6.4 Public Call Offices (PCOs)
2.7 Fibre optic cable projects
2.8 National optical fibre network
2.9 Wireless Local Loop (WLL)
3. Infrastructure developments
3.1 IP networks
3.2 Next Generation Networks (NGN)
4. International infrastructure
4.1 Background
4.2 Interconnect agreements
4.3 India-Pakistan
4.4 International service disruption
4.5 Submarine cable networks
4.5.1 FLAG
4.5.2 Network i2i
4.5.3 Tata-Indicom cable
4.5.4 SEA-ME-WE 4
4.5.5 Bharat Lanka cable
4.5.6 India, Middle East, Western Europe (I-ME-WE) cable
4.5.7 Europe India Gateway (EIG) cable
4.5.8 Submarine cable developments
4.6 Satellite communications
4.6.1 INSAT
4.6.2 Intelsat
4.6.3 Thaicom (formerly ShinSat)
5. Notes on forecasting
6. Related reports
List of Tables, Charts and Exhibits
Table 1 – Fixed-line subscribers and teledensity – 2005 - 2012
Table 2 – Fixed-line subscribers and teledensity (historical) – 1995 - 2005
Table 3 – Forecast fixed line subscribers and penetration rates – 2015; 2020
Table 4 – Growth of VPT scheme – 2001 - 2012
Table 5 – PCOs in operation – 2003 - 2012
Table 6 – PCOs in operation and market share by operator – March 2012
Table 7 – Fixed WLL subscribers (historical) – 2004 - 2006
Chart 1 - Fixed-line subscribers and teledensity – 2005 - 2012
Chart 2 - Fixed-line subscribers and teledensity (historical) – 1995 - 2005
Exhibit 1 – International submarine cable systems with landing points in India - 2011
Exhibit 2 – ISRO satellite network – September 2012

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