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V. Rishi Kumar

Hyderabad , Sept. 4

THOUGH most issues confronting the telecom sector have been ironed out, faster penetration and foreign direct investment are a few areas which need to be addressed to achieve higher growth level, according to Mr Asim Ghosh, Hutchison Essar Managing Director.

Speaking to Business Line during his recent visit to Hyderabad for the announcement of its expansion in Andhra Pradesh, which has so far seen about Rs 500-crore investment, Mr Ghosh felt that the country has the potential to attract about $50-$70 billion in investments over the next 10 years.

Implying that the potential has been barely tapped, Mr Ghosh said it was possible to rapidly grow the sector provided the right moves were made. With regard to the fast-paced growth of the state-owned BSNL, Mr Ghosh said it had tapered slowly over the last few months. When asked to comment on the possibility of the tariffs going down further, Mr Ghosh said it would not be appropriate to hazard a guess on this issue. "The matter of fact is that we need to analyse what is the justifiable level that makes the cellular operations viable before going into the rate related issues."

At an investment of about $100 per connection, and if the country chose to grow the tele-density to about 15 per cent, it could translate to a huge sum of about $15 billion to provide 15 million lines. It was realistically possible to attract investments of about $50 to $70 billion in the sector, subject to certain key issues like predictability of licence, an environment to attract FDI and address issues concerning the unified licensing regime, Mr Ghosh said.

According to him, it was a matter of deciding what path we would like to adopt — be happy with the current levels of growth of about 100 per cent year-on-year on a relatively smaller base or really penetrate the market and increase the tele-density.

An issue like the Calling Party Pays regime, which is a key driver of telecom growth all over the world, took about four years to be resolved in India. This has in fact impacted the growth of the sector significantly due to delays in finding an early solution.

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