India needs $12 bn for 100 m cell users

India needs an investment of at least $12 billion to achieve the target of 100 million cellular phone subscribers in the country, said Pradip Baijal, chairman, Telecom Regulatory Authority of India.

He said this while addressing the industrialists at the Gujarat Chamber of Commerce and Industry on Saturday.

He said, "In the last eight years between 1995 and March, 2003, the number of mobile phone connections grew to 13 million, while over the last eight months between April 2003 and November 2003, the number of mobile phone connection was more than double at 27 million. The growth in the last eight months is greater than the growth in the last eight years."

According to Baijal, Trai has fixed an ambitious target to increase mobile and WLL connections to 100 million by December 2005, which was 13 million in March 2003.

At present, the number of mobile users in the country stands at 27 million, which is expected to be 36 million by March 2004, 70 million by March 2005 and 100 million by December 2005.

The number of both cellular and WLL users registered huge growths in 2003.

"China, which has a population of 1.30 billion, 1.2 times that of India, has achieved more than 250 million cellular subscribers. India typically achieves one-third of the penetration in consumer products vis-…-vis China. So achieving 100 million subscribers by December 2005 is not impossible. We can achieve the target of 100 million subscribers by December 2005 by making telecom a litigation-free sector, intensifying competition among the service providers and investment of about $12 billion by all the companies," Baijal said.

The penetration of cellular service in India is only 7.2 per cent compared to 28.5 per cent in China.

The competition in the cellular industry is intensifying with 12 private cellular operators apart from the government-owned BSNL and MTNL vying for more subscribers.

Because of the competition, BSNL is losing its customers throughout the country. In Gujarat alone, BSNL has lost 125,000 subscribers.

Shreyas Pandya, president, GCCI, said, "The cellular industry in Gujarat has witnessed a tremendous growth in the recent months. In Gujarat, the industry has registered a 63 per cent growth since January this year. More than 550,000 subscribers have been added up to July 31, 2003, taking the total number of subscribers to 1.33 million compared to 79.8 million as on January 1, 2003."

"The need of the hour is to move towards full convergence, which will allow a service provider to provide landline, mobile phones, internet, STD, ISD, broadband operations and entertainment on television."

He said Trai should consider introduction of the concept of local number portability which would allow the subscribers to switch providers while retaining the same number.

"NRIs visiting Gujarat were surprised over the increase in the use of mobile phones in our country, which shows a great transformation in the telecom sector in the last several years," said Chinubhai Shah, vice president, GCCI.