In order to increase the tele-density, the Economic Survey has suggested pro-competitive efforts in the form of public policy, new technologies, entry of new players and lower tariffs. However, India is much ahead of tele-density compared to neighbouring countries like Pakistan, Bangladesh and Nepal but behind Sri Lanka, it said.
The Survey suggests that the recently launched broadband services are likely to become cheaper with the rise in volume and competition. The broadband policy aims at 3 million broadband subscribers and 6 million Internet subscribers by 2005-end.
The survey terms the emerging broadband servive as the next frontier and said that a sharp drop in broadband telecom prices in late 2004 might represent the beginning of a phase of hectic expansion of the sector.Broadband policy will help our rural areas to take advantage of the benefits of e-governance, e-education and e-health, President APJ Abdul Kalam said in his address to Parliament.
In 1999, both mobile phones and private sector separately accounted for 5% of the total number of phones. In October 2004, mobile phones accounted for 50% of total phones and the private sector accounted for 44% of total phones, the survey said.
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BSNL, MTNL losing out marketshare to private players
The survey said that the private sector is eating into the market share of the public sector units (PSUs), Bharat Sanchar Nigam Limited (BSNL) and Mahanagar Telephone Nigam Limited (MTNL), despite their growth in mobile telephony.
Over the recent period, BSNL and MTNL have lost market share in fixed telephony from 98.65% to 91.39%. In the past two years, PSUs have actually seen a decline in the number of fixed lines while such lines have grown in the private sector, the survey said.
The survey also takes note of the sharp fall in tariffs due to competition. The peak long distance tariff between Delhi and Mumbai has come down to Rs 2.40 per minute in 2004 from Rs 30 per minute in 2000. The international call charges to the US have also dropped to Rs 7.20 per minute (2004) from Rs 61.20 per minute in 2000.