Notwithstanding the various controversies due to faulty policy decisions in the telecom sector, the Economic Survey on Friday said that all is well in the communications industry. The Survey said that the opening up of the sector has not only led to the growth of the telecommunications infrastructure in the country it has also benefitted consumers.

Rural boom

The Survey has highlighted that the growth rate of telephone connections in rural areas is now almost double that in urban areas and the private operators have contributed nearly 85 per cent of this growth.

“During 2009-10, the growth rate of rural telephones was 62.6 per cent as against 37.32 per cent for urban telephones. The private sector has contributed crucially to the growth of rural telephones by providing about 84.5 per cent of telephones as in November 2010,” the Survey said.

Tele-density

As a result rural tele-density, which was above 1.57 per cent in March 2004, has increased to 30.18 per cent at the end of November 2010.

Interestingly, urban tele-density has increased from 20.74 per cent in March 2004 to 143.95 per cent at the end of November 2010. This means that in urban areas there are more mobile phones than the population due to one subscriber having multiple connections.

While the Survey gave credit to the Government for successfully concluding 3G, broadband auctions and launching Mobile Number Portability, it did not mention anything about the need for undertaking 2G spectrum reforms.

Instead the Survey highlighted favourable factors such as policy moves taken by the Government, incentives offered, large talent pool in R&D, and low labour cost for manufacturing.

“The production of telecom equipments in value terms increased from Rs 48,800 crore during 2008-09 to Rs 51,000 crore during 2009-10. The worth of telecom equipment including customer premises equipment (CPE) produced during 2010-11 is expected to be about Rs 53,500 crore,” the Survey said.

tkt@thehindu.co.in

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