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Growing Reach: Initiatives to increase telecom connectivity in rural areas

March 23, 2018
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Despite government efforts to connect the rural and semi-urban areas of the country, a major digital gap still remains. In particular, regions like the Northeast have lagged behind in terms of telecom infrastructure development owing to difficulty in rolling out networks in difficult terrain. Telecom operators have also faced challenges owing to limited access to power supply and frequent landslides in many areas as well as security concerns in insurgency-ridden areas of the country.


In a bid to extend telecom connectivity to rural and remote areas, the government established the Universal Service Obligation [USO] Fund with the objective of financially supporting service roll-outs in these regions. Over the past few years, the USO Fund has provided support to various schemes aimed at improving connectivity in the Northeast and Left Wing Extremism (LWE)-affected areas. Bharat Sanchar Nigam Limited (BSNL) and central public sector units like RailTel and Powertel have implemented many such projects. Further, the ambitious BharatNet project is also expected to significantly improve rural network coverage.

Progress under BharatNet

The BharatNet project aims to provide high speed broadband and Wi-Fi services to 250,000 gram panchayats (GPs) by March 2019 on a universal and non-discriminatory basis. The past year witnessed a landmark achievement for the government as it completed the provision of optical fibre connectivity to 100,000 GPs under the first phase of BharatNet. As of February 4, 2018, 102,414 GPs have been made service ready and work on laying optical fibre has started in 121,901 GPs. Further, 261,158 km of optical fibre cable (OFC) has been laid in 111,257 GPs across the country under the project. For the second phase of the project, which aims to provide broadband services to 150,000 GPs, the government has proposed to allocate Rs 80 billion under the Union Budget 2018. Moreover, the government has proposed to set up 500,000 Wi-Fi hotspots that will provide broadband access to 50 million rural citizens.

Progress in the Northeast

The government along with the Department of Telecommunications (DoT) has initiated a slew of initiatives to provide connectivity in the Northeast. State-run operator BSNL was tasked to implement the project in the difficult and hilly terrain of Arunachal Pradesh, and two districts of Assam – Karbi Anglong and Dima Hasao. To this end, an MoU was signed between BSNL and the USO Fund to set up 2,817 mobile towers in these places.

The government has also launched the Asthamangal project at a cost of around Rs 350 million. Under the project, a bandwidth of 810 Gbps has been provided by BSNL using Powertel’s optical ground wire for all state headquarters and key locations in the north-eastern region.

Recently, the government announced its plans to invest Rs 107.43 billion in various projects for improving the telecommunication network in the north-eastern states and along national highways in the region. Most of these projects will be completed by December 2018.

Progress in LWE regions

In September 2016, under the PRAGATI programme, the government successfully completed the roll-out of telecom networks in areas worst affected by LWE across Andhra Pradesh, Bihar, Chhattisgarh, Jharkhand, Maharashtra, Madhya Pradesh, Odisha, Telangana, Uttar Pradesh and West Bengal to boost development in the Red Corridor.

In the past two years, BSNL has set up mobile towers in LWE-affected areas, which cater to nearly 18 million people in 22,688 villages across 90 districts in 10 states. This initiative is noteworthy with the connected areas recording a data consumption of 400 GB per day on the 2G network of the sole service provider, BSNL, in November 2017. This surge in data consumption highlights the need to provide network connectivity in unaccessible and remote regions of rural India.

In addition, the government has sanctioned Rs 183 million for the installation of 1,028 mobile towers in the Naxal-affected regions of Chhattisgarh. The state government has also launched the BastarNet project to strengthen mobile and internet connectivity across the LWE-affected Bastar division of Chhattisgarh and connect the seven districts of Kanker, Kondagaon, Bijapur, Narayanpur, Bastar, Sukma and Dantewada. Under the project, a massive 836 km OFC backbone is being laid to boost the communication system in the seven districts. The network is based on the ring topology mechanism to ensure uninterrupted mobile and internet connectivity through alternative routes.

Private push

Traditionally, private operators have not played a major role in the rural telecom space. These markets are characterised by low ARPUs and are less commercially attractive for operators. However, given the untapped potential of these markets, several operators have forayed into this space in the past few years. To make a financial business case, they have entered into infrastructure-sharing agreements to enhance their rural reach. Recently, telecom operators such as Reliance Jio Infocomm Limited (RJIL), Bharti Airtel, Idea Cellular and Vodafone India have committed to provide services by leasing bandwidth under the BharatNet project. To this end, RJIL paid an advance subscription fee of Rs 130 million to provide broadband services to 30,000 GPs on the condition that it would buy bandwidth in every panchayat from the government as it expands services. Similarly, Bharti Airtel paid Rs 50 million to cover 30,500 GPs, while Vodafone India and Idea Cellular paid Rs 1.1 million and Rs 0.5 million respectively as an advance subscription fee under the second phase of the project.

Further, the government has announced a viability gap funding (VGF) support of Rs 36 billion to telecom operators for rolling out Wi-Fi services in villages that may not have been commercially viable initially. Private players have also been tasked to implement telecom infrastructure projects across the north-eastern states such as Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura. In December 2017, Bharti Airtel signed an agreement with DoT and the USO Fund to facilitate the provision of mobile services in about 2,100 identified uncovered villages and national highways in the north-eastern states to boost connectivity. The project is expected to be completed by 2019 and the USO Fund will invest around Rs 16.1 billion to support Airtel in implementing the project. Vodafone India has also set up 4,000 data sites across Sikkim and West Bengal over the past one year to cover 19,000 towns for strengthening its network.

Clearly, market forces alone cannot enable operators to adequately serve such regions. The government should incentivise the private sector through VGF and land subsidies for establishing tower sites. Further,  public-private partnerships should be encouraged in order to develop rural telecom infrastructure.

Case for VSAT

Broadband connectivity in rural and remote areas can also be provided through satellite technology, known as very small aperture terminal (VSAT), which enables wireless connectivity through satellites. VSAT technology offers connectivity without geographical or location constraints and hence is an ideal option for rural areas. To this end, the government has planned to launch the GSAT-11 satellite in 2018, which will help provide broadband services in rural areas through satellite-based VSAT technology. Further, the government has allocated funds under the Union Budget 2018 for bandwidth upgradation at 302 VSAT sites, from the existing 512 kbps to 1 Mbps. However, the technology has garnered mixed reactions from various stakeholders, as satellite internet services are not as viable for the masses as they are for small and medium businesses since they require the deployment of indoor and outdoor units.

The way forward

The need for setting up telecom infrastructure in rural areas is important as the availability of comprehensive telecom services can result in better governance, telemedicine facilities and proliferation of e-education. It will also enable farmers to access wider markets, timely weather information and employment opportunities. As such, the development of rural telecom infrastructure needs to be the top priority of the government as this would help expedite the process of digitising India.


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