Optical fibre cable (OFC) lies at the forefront of modern telecommunications infrastructure, facilitating the global connectivity essential for today’s digital age. As the demand for high speed internet and advanced communication networks continues to surge worldwide, the production of OFC plays a pivotal role in meeting these needs. India, in particular, is becoming one of the largest manufacturers of various types of cables.
Market landscape
While the industry has highlighted optimism about future growth, including a strong CAGR, the past several quarters have been among the most challenging times for the optical fibre industry. The primary reason for this is India’s low per capita deployment of optical fibre, which is not even 0.1 km – significantly lower than in developed economies such as the US, where it is 10-15 times higher. Despite this, fibre consumption in India has remained at 18-20 million km over the past several years.
Demand for fibre
There is a visible surge in OFC demand, driven by rising data consumption per user per month, increased tower fiberisation and the overall OFC industry growth. Deployed route kilometres and market valuation are also expected to grow significantly by 2028 and 2032 respectively.
Fibre has a lot to offer, including unlimited bandwidth potential, symmetrical upload and download speeds, high speed networks, energy efficiency, sustainability and long-term cost-effectiveness. Currently, a significant portion of data consumption is driven by video content, especially high-definition videos, which account for 70 per cent of the overall traffic, followed by entertainment, including cloud gaming and live streaming, and sports events like the Indian Premier League, cricket matches and football tournaments. Social media also contributes to the demand.
The future is increasingly being shaped by artificial intelligence (AI). AI, self-driven transportation, internet of things (IoT) and robotics are growing, with AI alone expected to grow at a CAGR of 25 per cent and reach $250 billion by 2030. Alongside that, around 5.5 billion IoT and robotics connections are expected by 2030, covering agriculture, healthcare, education, and other industries.
Going forward, there will be high demand for low latency and flexible connectivity enabled by 5G, fibre-to-the-home (FTTH), fixed wireless access (FWA) and edge data centres. Therefore, while discussing demand, it is important to examine the initiatives and strategies of key stakeholders in the country, such as telecom service providers and hyperscalers.
In 2025, global fibre demand is expected to reach 585 million km. Excluding China, which accounts for 50 per cent of this demand, the rest of the world will need 310 million km of fibre.
Capacity-wise, China has 400 million km, while North America has 150 million km. India’s capacity is one-fourth that of China and two-thirds that of North America. In terms of consumption share, China holds 50 per cent, North America three times less and India only 3 per cent. However, this indicates strong growth potential, supported by government initiatives like BharatNet, Gujarat Fibre and MahaNet, as well as the rise of data centres. India’s share in global fibre demand is expected to rise to around 5 per cent by 2029 or 2030, underscoring the significant opportunities ahead.
Deployments and challenges
Earlier, fibre networks consisted of local distribution network rings or metro fibre rings, but now fibre is needed everywhere, across smart cities, medical centres, enterprises and residences. Addressing these challenges is essential to improving existing products and driving the development of new technologies.
In legacy networks, multiple cables were required, such as one for fibre data and another for power. However, there is now a growing emphasis on developing greener, low-carbon solutions aligned with environmental, social and governance commitments to reduce the carbon footprint. This led to the idea of using a single cable to distribute both data and power simultaneously.
Time was also a constraint. Managing multiple cables required significant space, involved complex cable management, and, most importantly, demanded substantial capital.
The third challenge was the need for faster deployment. Using multiple cables required more manpower and greater investment, making the process time-consuming and costly. There was a clear need for a product that could transmit both data and power through a single cable, simplifying execution and reducing complexity. In response to these challenges, the industry introduced a cable that could seamlessly transmit both data and power in a single run, particularly useful for wireless local area network access networks, 5G stations and video surveillance.
Additional challenges include slow deployment, rising network losses, right-of-way (RoW) hurdles, complexities in FTTH deployment and monetisation of investments.
Last-mile connectivity
While the need for connectivity is well understood in today’s digital era, actual deployment, especially in the last-mile, remains sluggish. Multiple competing technologies are emerging and will continue to coexist, whether it is satellite communication alongside fibre for backhaul, or FWA complementing fibre in the last mile. However, fibre remains the backbone of digital infrastructure. To fully realise the potential of 5G, communication must run through fibre. Therefore, accelerating last mile optical fibre deployment is essential.
Further, a major issue is the unplanned development across the country. The problem lies more with planning than execution. If planning is done well, execution follows, because well planned is half delivered.
Global protectionism
When global consumption goes down, countries start reconsidering where to invest, whether in national security, people-centric investments or advanced digital network development. This becomes a pressing question when geopolitical conditions are uncertain.
China is a classic example. It has long been a global leader, accounting for more than 50 per cent of the global consumption. However, in the past two to two-and-a-half years, its consumption has dropped. Even the largest telco, China Mobile, did not announce a tender last year because the previous year’s consumption target was not achieved. They are still procuring fibre from that existing tender. Due to these geopolitical shifts, every country is focused on protecting its industries.
Europe, for example, has imposed antidumping duties, first on China and now on India. The US is doing the same. These protectionist measures limit market access, and when the domestic market remains stagnant, the issue compounds. It has been a tough period for the fibre cable industry over the past few quarters.
Now, however, government-led investment is providing some relief. BharatNet has kicked off, and utilities, especially railways, are investing heavily. Projects like Kavach and the dedicated freight corridors are being actively discussed. There is also significant investment from power utilities alongside telcos, which is a positive sign for India. However, unless domestic consumption increases, the industry will continue to struggle.
Market trends and growth drivers
Bandwidth use cases are evolving across sectors. In telecom, power and utilities, defence, metro and rail, smart cities, and FTTH, the focus is on high-bandwidth, secure communication, service integration and control centre connectivity. Looking ahead, 6G, self-healing grids, smart defence, efficient train collision control systems, IoT/smart homes and smart city management are poised to gain traction.
Emerging technologies across domains will demand more bandwidth. Industry 4.0/5.0, smart farming, gas utilities, infrastructure, health and medical, and environmental sectors are seeing applications such as human-robot collaboration, drone inspections, IoT-based field sensing, oil and gas monitoring, robotic surgeries and environmental systems, respectively.
Further, a robust backbone is needed to support data centres, cloud computing and AI-based IoT systems. This requires minimum touchpoints, low latency and high capacity to ensure efficient performance.
Hyperscalers and telcos are driving transformation across sectors. SpaceX has partnered with Reliance Jio and Bharti Airtel for their low earth orbit satellites, which will help connect areas where the network is currently unavailable. Further, all telcos are working on making their networks more robust with better adaptability and quality of service by adopting cloud-native networks.
The country is now transitioning from legacy data centres to edge data centres. A key point is that while telcos own and operate networks, companies like Netflix and Amazon leverage these networks to deliver their services and earn revenue. There must be a revenue-sharing model so that this becomes a long-term, fruitful association. Communication service providers are now becoming digital service providers, and fibre connectivity will remain at the core of these networks, whether wireless or wireline.
The way forward
The current year appears more promising compared to the previous year, and India’s per capita fibre consumption is expected to grow three to four times in the coming years, bringing the country closer to achieving seamless connectivity.
Looking ahead, recognising fibre as the fourth utility, alongside water, gas and electricity, could be a game changer. Construction approvals for commercial and residential projects should ideally be contingent on pre-installed fibre infrastructure. The challenge is not a lack of investor interest, but the regulatory barriers that continue to slow down progress. While short-term technologies can offer interim solutions, they cannot replace the need for a strong fibre-based network. In this context, government efforts to streamline RoW permissions are a welcome move and are likely to encourage greater investment in the sector.
Based on remarks by Pramod Srivastava, CEO, West Coast Optilinks; and presentations by Sumit Singh, Head – Domestic Sales, APAR Industries Limited, and Ashish Goyal, Head – Telecom Business, West Coast Optilinks
