Indian Telecom Sector Perched to Grow

by CXOtoday Staff    Dec 26, 2006

With the government setting up the target of 250 million phones by Dec 2007, teledensity in India is set to increase to 22% from the current 16.28%, said a statement by the Department of Telecommunications (DoT).

The total number of telephones has increased from 125.79 million as on Dec 31, 2005 to 183.46 million as on Nov 30, 2006. The share of wireless phones has gone up from 68% in December 2005 to 78% in November 2006, according to the DoT statement.

During the year India surpassed the target of 100 million GSM mobile subscribers.

The DoT said, “Under Bharat Nirman Programme, out of 66,822 villages, a total of 36,014 village public telephones (VPTs) have been provided as on Oct 31. The rest of the villages will be covered well ahead of Nov 2007. 14,183 villages will be covered with telephony using the digital satellite phone terminals (DSPT) technology using the Indian satellite band frequency, the procurement of which is underway.”

Indian telecom sector’s exceptional growth has also attracted international telecom companies, who are eager to set up their manufacturing bases here.

“Major companies like Foxconn, Aspcomomp, and Solectron have decided to set up their manufacturing bases in India. In the telecom manufacturing itself, there has been a commitment of more than $1.5 billion,” DoT said.

Fresh commitments of about $2 billion in the next one year or so in the telecom manufacturing, are also expected.

Nokia and LG Electronics have set up manufacturing facilities in Chennai and Pune, respectively.

Recently, Ericsson launched their R&D centre in Chennai. Motorola set its unit with an investment of over $100 million and is expected to start production in the first quarter of 2007.

A large number of companies like Alcatel, Cisco have also shown interest in setting up their R&D centres in India, the DoT said.