India is the world’s second-largest telecommunications market, with 898 million subscribers as of March 2013. The sector's revenue grew by 13.4 per cent to reach US$ 64.1 billion in FY12. Wireless and wireline revenue increased at a compounded annual growth rate (CAGR) of 11.9 per cent to reach US$ 40.8 billion over FY07-12.; revenues from the telecom equipment segment in FY12 stood at US$ 23.5 billion as compared to US$ 23.4 billion in FY11.
Availability of affordable smartphones and lower rates are expected to drive growth in the Indian telecom industry. The Government of India (GOI) has been proactive in its efforts to transform India into a global telecommunication hub. The government has allowed foreign direct investment (FDI) of up to 74 per cent in basic and cellular, unified access, national/international long distance, and V-Sat services as well as public mobile radio trucked services. FDI of up to100 per cent is permitted for infrastructure providers offering dark fibre, electronic mail and voice mail.
The surge in the subscriber base has necessitated a network expansion covering a wider area, thereby creating a need for significant investment in telecom infrastructure. Telecom infrastructure in India is expected to increase at a CAGR of 20 per cent during 2008-15 to reach 571,000 towers in 2015.