The Hindu Business Line : TRAI calls for sops to boost rural telephony

THE Telecom Regulatory Authority of India (TRAI) has said that the Government needs to increase the level of competition in the rural sector by offering incentives to telecom service providers.

In a study paper on the growth potential in India, the telecom regulator has highlighted that the operators would require to add 4 million new users every month, compared with just around 1.5 million at present, to achieve the targets set by the Government. This was possible only if telecom services were made available in the rural segment.

In the study paper, TRAI has said that the rural-urban digital divide was widening due to lack of coverage in the rural sector. It has said that Government policies must ensure that competition drives the rural market like in urban areas.

"At present, there is negligible rural mobile coverage and the growth is driven by public sector units and universal services obligation fund. Unless it is competition driven, the growth will continue to be stagnant," said the TRAI paper.

Future strategies must be focussed on reducing costs and fee.

TRAI said that the burden on Indian operators in terms of taxes, levies and fees is one of the highest in the world even as the tariffs are among the lowest anywhere in the world. The telecom regulator urged the Government to bring down the levies to a level that would be enough to recover the administrative costs of the various authorities in the communications sector.

With an entry cost of only $40 per subscriber, there was a huge pent up demand waiting to be tapped. TRAI said that if other developing countries with lower GDP than India have been able to achieve higher tele-density targets, India can also achieve the objectives laid out by the Communication Ministry of reaching over 20 per cent tele-density in the next two years with a coverage across 75 per cent of the country.

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