union-buget-economic-surveyWe sincerely hope that Indian government implements the suggestions put forth in the 2008-09 Economic Survey released yesterday: each of the suggestions will greatly help in the growth of broadband in India, and reduce the ambiguity and lack of transparency that afflicts the telecom auctions, apart from helping the Internet become a means for the country to earn foreign exchange. In Part One of this two part series, we’ve covered the suggestions put forth in the Economic Survey. In Part Two, we’ll share inputs from the Economic Survey on investments made in telecom and communications both by the government and foreign investors, and share related data.

Part I: Suggestions On Mobile & Broadband

— Create an Internet enabled data/information system(s) to help MSMEs market their goods and services across India and the world: exports are what brought the IT/ITES services significant support, reader Sumant Srivatsan mentioned to me yesterday. Using the Internet to help earn key foreign exchange for the country is an angle that entities lobbying the government should employ to help receive government support.

— Unbundling the last mile: The Economic Survey suggests allowing open access to local loop for broadband provision – which essentially means opening of the last mile. Among the most significant capital expenditure of providing broadband is laying the copper to the users house, while public sector telecom operators like BSNL and MTNL already have that infrastructure in place. Opening up access to the local loop means that no duplication of infrastructure is required, and any service provider can use public infrastructure to provide broadband. Doing this is likely to reduce the cost of broadband access for consumers.

— Setting Up A Rural Fibre Optic Network: The Economic Survey suggests a ‘public carrier’ for provisioning telecom connectivity in rural areas, which will operate as a rural fibre optic network. “Eliminate revenue share and other telecom charges on provision of broadband connectivity to villages,” the survey suggests. Again, a key issue with telecom and broadband in rural areas is

— Spectrum Trading, Disaggregate telecom licences from spectrum allocation: Telecom licence should have a nominal regulatory charge and be based on capability to provide sustained service. The Economic Survey suggests that spectrum should be auctioned and be freely tradable among companies having a telecom licence. The auction price can be in the form of a fixed price or charge per unit of bandwidth per annum or a combination of the two.

However, we do think that there should be a limit to the amount of spectrum a company can put up for trading, since this shouldn’t result in companies merely buying spectrum for trading; there is a risk of a formation of a cartel of traders artificially increasing spectrum prices, and with no focus on rolling out services; rollout obligations should not be relaxed.

Related:

— Why Not A Spectrum Trading Exchange?
— Budget 09 Demands: CII On Broadband, Indic Languages, Telemedicine, USO Fund, Spectrum & Taxes
— Budget Demands 2009: Duty Cuts, Tax Holidays; DTH, Cable, TV; Past Budgets
— Roundup: Handset, DTH Taxes; Pyramid Saimira; Industry Moves; Oxigen; Bindass; FM Licenses;