The critical spectrum bandwidth of 45 Mhz for the starved telecom network could come through early next year. The department of telecommunications (DoT) has sought approval from the Cabinet Committee of Economic Affairs (CCEA) for developing an alternate communication network for the Indian Air Force. The alternate communication link would cost the DoT Rs 1,077.16 crore.
With the creation of the alternate network, the IAF will release the spectrum for civilian use. DoT has promised that the project will be completed by June 2008. The delivery and installation work of the project will be done even earlier?December 31 for the 60 priority stations. For the others, delivery and installation work will be done by March 31, 2008, the DoT has said. The assets created will belong to DoT during the currency of the project and after completion these will be transferred to the ministry of defence as book transfer.
In a note drafted for the CCEA?s approval, the DoT has said by conservative estimates, release of 45 Mhz spectrum by defence services, coupled with coordination of complementing spectrum from BSNL, will lead to potential capacity of additional 100 million mobile connections in the next 2-3 years.
?Even with an assumption of modest average realisation per user of Rs 3,000 per annum, the additional revenue for telecom operators will be around Rs 30,000 crore. The government revenues (3% spectrum charge, 6% licence fee and 12% service tax) from these connections will be about Rs 6,500 crore per annum once these additional 100 million lines are in place,? the note has said.
Seeking approval, the DoT has said the boost in capacity would also have forward linkages to other related industries such as telecom equipment manufacturing and other telecommunication related services. This will have an appreciable positive impact on GDP growth. It has said the congestion of mobile network is increasing at a rapid rate resulting in jamming of networks, call drops and poor voice quality. The benchmarks prescribed by Trai are not being met by most of the operators. One of the contributing factor is inadequacy of spectrum in metropolitan areas and main cities. These problems are going to aggravate further with increase in the mobile subscriber base. The release of spectrum will help to overcome these problems.
With the government targeting 500 million telephone connections by 2010 and DoT committed to roll out 3G services at the earliest, there is a strong need to vacate the spectrum being used by defence in a time-bound manner and making it available for mobile services to maintain the momentum of growth, the DoT has said.
