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India is one of the biggest consumer of data worldwide. As per TRAI, average wireless data usage per wireless data subscriber was 11 GB per month in FY20. It is expected to reach to 18 GB by 2024.

Indian Telecom Industry Analysis

    Last updated on Dec, 3 2021

India is the world's second-largest telecommunications market. The telecom market can be split into three segments - wireless, wireline and internet services. The total subscriber base stood at 1,209.58 million in August 2021. Tele-density of rural subscribers reached 60.27% in August 2021, from 59.06% in August 2020, indicating potential demand growth from the rural sector.

The total wireless or mobile telephone subscriber base increased to 1,186.72 million in August 2021, from 1,147.92 million in August 2020. The total number of internet subscribers stood at 813.5 million in August 2021. Of this subscriber base, the number of wired internet subscribers was 24.29 million and wireless internet subscribers was 787.94 million.

India is also the second-largest country in terms of internet subscribers. India is one of the biggest consumer of data worldwide. As per TRAI, average wireless data usage per wireless data subscriber was 11 GB per month in FY20. App downloads in the country increased from 12.07 billion in 2017 to 19 billion in 2019 and is expected to reach 37.21 billion by 2022F. The total wireless data usage in India grew 16.54% quarterly to reach 32,397 PB in the first quarter of FY22. The contribution of 3G and 4G data usage to the total volume of wireless data usage was 1.78% and 97.74%, respectively, in the third quarter of FY21. Share of 2G data usage stood at 0.48% in the same quarter.

In July 2021, tele-density stood at 88.51%. The total number of internet subscribers increased to 808.60 million in July 2021. The wireless subscriber base of Jio stood at 443.61 million, Bharti Airtel (198.23 million) and Vodafone Idea (119.63 million), as of July 2021.

Gross revenue of the telecom sector stood at Rs. 64,801 crore (US$ 8.74 billion) in the first quarter of FY22. Strong policy support from the Government has been crucial to the sector’s development. Foreign Direct Investment (FDI) cap in the telecom sector has been increased to 100% from 74%. In October 2021, the government notified 100% foreign direct investment (FDI) via the automatic route from previous 49% in the telecommunications sector. FDI inflow in the telecom sector stood at US$ 37.97 billion between April 2000 and June 2021.

According to a Zenith Media survey, India is expected to become the fastest-growing telecom advertisement market, with an annual growth rate of 11% between 2020 and 2023.

The Government of India, through its National Digital Communications Policy, foresee investment worth US$ 100 billion in the telecommunications sector by 2022. The government is encouraging global telecom network manufacturers such as Ericsson, Nokia, Samsung and Huawei to manufacture all their equipment in India with 100% local products. The Rs. 12,195 crore (US$ 1.65 billion) production-linked incentive (PLI) scheme has already triggered entry of several global players manufacturing mobile devices and components. European telecom gear vendors like Ericsson and Nokia are eager to expand their existing operation in India for global supply chain under the PLI scheme. Similarly, other global vendors like Samsung, Cisco, Ciena, Jabil, Foxconn, Sanmina and Flex have shown interest to set up manufacturing in India for telecom and networking products under the newly announced PLI scheme.

In March 2021, TEPC (Telecom Equipment Export Promotion Council) organised India Telecom 2021—a platform for convergence of technologies and business exchange.

In July 2021, Bharat Broadband Network Limited (BBNL), on behalf of the Department of Telecommunication, invited global tender for the development of BharatNet through the Public-private Partnership model in 9 separate packages across 16 states for a concession period of 30 years. Under this project, the government will provide a maximum grant of Rs. 19,041 crore (US$ 2.56 billion) as viability gap funding.

In August 2021, the Department of Telecommunications (DoT) officials stated that it is working on a package, which includes reducing the revenue share licence fee to 6% of adjusted gross revenue (AGR) of the operators from the current 8%. This would be done by reducing the 5% universal service obligation levy by two percentage points and providing relief of about Rs. 3,000 crore (US$ 403.63 million) annually to the operators.

In October 2021, Telecom Secretary Mr. K. Rajaraman inaugurated the Quantum Communication Lab at the Centre for Development of Telematics (C-DOT), Delhi, and unveiled the indigenously developed Quantum Key Distribution (QKD) solution by C-DOT. QKD can support a distance of >100 kms on standard optical fibre.

The Union Cabinet approved Rs. 12,195 crore (US$ 1.65 billion) production-linked incentive (PLI) scheme for telecom & networking products under the Department of Telecom.

F- Forecast, PB - Petabytes

Indian Telecommunications Industry Report (September, 2021)
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Click to access the Telecommunications Industry Archived Report

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