An analysis conducted by Greenfield Foreign Direct Investment has shown India ranks the lowest in the fibre development index despite being one of the world’s fastest growing telecom markets. Major telecom markets including Singapore, South Korea, China, Japan, the US, Canada, Australia, the UK and Germany rank higher in the fibre development index than India. Further, India’s fibre kilometre (fkm) per capita stands at a meagre 0.09 fkm, as compared to Japan’s 1.35 fkm, the US’s 1.34 fkm and China’s 0.87 fkm. This underscores the need for scaling up optical fibre cable (OFC) networks in India to fully leverage the potential of 5G.
Benefits of fibre-based 5G networks
The roll-out of an effective 5G network requires the deployment of 20-30 times the existing amount of fibre cable in India. Fibre can support multiple network topologies concurrently while ensuring unparalleled security and dependability. This positions fibre networks as one of the most reliable infrastructures for 5G backhaul. A robust fibre cable network provides several benefits. It ensures low latency and seamless network access for users, and contributes to improved mobile coverage and faster internet speeds.
OFC demand scenario
The global demand for OFC reached 535 million fkm in 2022. China witnessed the highest demand of over 260 million fkm, whereas India’s demand lagged behind with a modest demand of 18 million-20 million fkm. While India and China share a lot of similarities in terms of population size and pattern, the same cannot be said for fibre cable deployment. During 2020-22, China’s demand for OFC networks increased periodically, starting from 237 million fkm in 2020 and moving all the way up to 264 million fkm in 2022. Meanwhile, the demand for OFC networks in India remained stagnant during the same period, growing marginally from 17 million fkm to only 18 million fkm.
This is in contrast to the fact that India is a global fibre supplier. India’s fibre exports during 2020-22 were significantly higher than its consumption, reaching 30-35 million fkm. During the same period, the country manufactured 55 million fkm of fibre cables. Interestingly, the Indian OFC market witnessed significant export growth as compared to the scarce demand in domestic circles. India generated a total of Rs 35.5 billion through OFC exports, while the revenue generated domestically was Rs 25 billion. This disparity between domestic and global demand could be a cause for concern.
Driving OFC growth in India
The economic impact of 5G deployment in India is estimated to reach $1 trillion by 2035. As of 2023, approximately 36 per cent of telecom towers have been fiberised. India must fiberise at least 70 per cent of its towers by 2025 to cater to the incoming demand for 5G networks. In order to drive the demand, the government should promote rural connectivity through various initiatives such as BharatNet, Digital India and the Smart Cities Mission.
As part of the National Broadband Mission, the Ministry of Road Transport and Highways is planning to establish internet connectivity for 200,000 km of national highways and expressways by 2025. Bharat Sanchar Nigam Limited is set to lead the investment for 4G deployment. The increasing number of data centres in India will further fuel the growth of 5G networks. Indian Railways is also planning to modernise its signalling and telecommunication infrastructure through 5G deployment.
Future outlook
The measures and initiatives taken by the government and telcos are expected to propel the demand for OFC networks in India. Over 500 million mobile subscribers are expected to transition to 5G by 2028 in India, which will further drive the expansion of OFC networks. s
Based on a presentation by Pramod Srivastava, Chief Executive Officer, West Coast Optilinks