The draft of the New Telecom Policy (NTP) is built around six strategic missions, namely universal and meaningful connectivity, fostering innovation, promoting domestic manufacturing, ensuring a secure and trusted network, enhancing ease of living and doing business, and advancing sustainable development.
Those missions are accompanied by concrete targets and strategies with outcomes tied to a timeline of 2030. In terms of economic growth, the aim is to double the telecom sector’s contribution to India’s gross domestic product (GDP) and to attract an annual investment of Rs 1 trillion (approximately $12 billion) in telecommunication infrastructure by then. This would imply that the information and communications technology (ICT) sector’s contribution to the GDP (which includes telecom) would rise to around 11 per cent by 2030, from the current 7.8 per cent.
In terms of trade, the NTP aims to double the export of telecom products and services and encourage hundreds of telecom startups. For perspective, the export of telecom products reached Rs 1.49 billion in 2023-24. It also hopes to create 1 million new jobs, and to upskill and reskill 1 million existing workers.
In terms of pure connectivity, the NTP aims to achieve 100 per cent population coverage through 4G and 90 per cent through 5G. It also aims to increase the fiberisation of telecom towers to 80 per cent by 2030, from the current 46 per cent and, ultimately, to 100 per cent. The security of critical telecom infrastructure will be strengthened, if necessary by adopting quantum-resistant cryptography. Finally, it aims for a 30 per cent reduction in the carbon footprint of the telecommunication sector to improve sustainability while all these goals are being pursued.
Those aims and targets are further compartmentalised into more granular goals. While the aims may seem ambitious, the initial goals being considered were even more onerous with, for example, a target of Rs 1.5 trillion being mentioned in annual investments, along with a target of complete fiberisation of towers while the draft was being composed.
The aims are unexceptionable, and, in principle, it is good to aim high. But are these targets substantially achievable? What are the hurdles and challenges?
A lot of this is interconnected, of course. If the investment targets and the export targets are to be achieved, large-scale upskilling as well as the induction of more workers will be required. Security is an absolute priority and deploying quantum encryption (a cutting-edge technique that is still at the proof of concept stage) will, in itself, involve a lot of innovation.
Universal connectivity is a basic aim. Saturation coverage of 4G, 90 per cent coverage of 5G and fiberisation of towers all seem physically achievable, if we consider the speed at which Reliance Jio and Bharti Airtel have rolled out their respective 5G and fibre networks in the past two years. The policy also suggests a light-touch regulatory framework for authorising submarine cable infrastructure to streamline connectivity expansion.
The provision of 1 million public Wi-Fi hotspots also seems possible. But it must be noted that a target of 10 million hotspots was set in 2018 under the previous National Digital Communications Policy, 2018 (NDCP), which the NTP is supposed to replace and only 55,000 have been rolled out over the next seven years. That target has been reduced to more realistic levels. Similarly, the target of 100 million connected households will require acceleration on roll-outs with just under 45 million households currently connected.
The launch of satellite broadband has just begun with three service providers now having licences. We will have a sense of where this is going by end-2025, and there is time for any necessary policy correction in order to connect terrestrial and satellite networks and thereby ensure that currently unserved areas are covered.
Achieving fiberisation of all gram panchayats (GPs) under BharatNet with an uptime of over 98 per cent also seems possible, but this is where one of the big question marks arises. BharatNet is handled by Bharat Sanchar Nigam Limited (BSNL) and the PSU’s chronic under-performance is an issue. This target has been postponed at least four times. In order to achieve this, either BSNL will have to turn around dramatically (and it shows some signs of doing this) or some other mechanism for connecting panchayats will have to be devised.
A new Digital Bharat Nidhi (DBN), which is a rework of the Universal Service Obligation Fund scheme, has been proposed to expand networks in remote and uncovered areas, along with incentives to fast-track fixed line broadband. The details will be important. The policy also proposes halving grievance redressal timelines, scaling up the Samriddh Gram model for village-level telecom access, and cutting red tape around spectrum allocations and right-of-way permissions. A composite electricity billing system for telecom players and simplified compliance for businesses are also planned.
A broader challenge lies in the underlying causes of poor rural connectivity. Why have India’s private operators hesitated to connect the hinterland? Part of the problem is difficult terrain, and satellite broadband is supposed to address that.
But poor rural connectivity is also very much a function of low incomes and uneven digital literacy. It is hard for a telecom service provider to develop commercially viable business models and generate acceptable returns on capital employed in rural areas. Substantial capital investment is required and that will not be available unless returns are visible. This is equally true in economic terms for satellite broadband, although the technical challenges are different.
Can the NTP enable the development of a commercial model that works in the hinterland? The NTP aims to ensure that telecom broadband services cost less than 2 per cent of monthly gross national income per capita – that would be about Rs 400 per month. This is considerably higher than the current average revenue per user (ARPU), which varies from Rs 250 per month for Airtel at the high end to a very low of Rs 40 for BSNL in some rural circles.
Rural per capita is much lower than the national average, and BSNL’s ARPU (which is running at a maximum of around Rs 175 in urban circles) is more relevant in assessing how much the rural consumer can pay since BSNL is a big player in rural areas. This highlights the challenges involved in providing rural connectivity at rates that are commercially viable for operators and also affordable for users. The rural connectivity challenges must be faced if the digital divide is to be closed.
Doubling exports (including services) will involve a lot of upskilling. The production-linked incentive scheme generates revenues of around Rs 800 billion in telecom-related products, and Rs 150 billion exports. The value-add of this is low, given the high import content. It will require huge investments to localise the manufacture of more components, and a lot of R&D to develop globally competitive products and services. The geopolitics of US tariff policies may also make exports more difficult (not just for telecom) since Indian goods could be priced out of the world’s largest market.
The NTP will promote “Made in India” telecom products globally through brand-building activities, and look to encourage investments in partner countries, leveraging lines of credit, as well as try to enhance the export competitiveness of Indian products by streamlining regulations and simplifying equipment certification processes. It looks to increase domestic telecom manufacturing output by 150 per cent.
The first target is to achieve 50 per cent import substitution through telecom products designed, developed and manufactured in India. That in itself will be a big value add. There are plans to establish a Telecom Manufacturing Zone (TMZ) with integrated infrastructure for enabling telecom and network equipment design and manufacturing. Also, there will be necessary changes to policy to facilitate the establishment of end-to-end supply chains for manufacturing telecom and network products in India. The policy also suggests providing targeted financial support to boost domestic telecom manufacturing and incentivising telecom operators to use indigenously designed and manufactured equipment.
In support of this, the NTP aims to establish 30 advanced research labs across top academic institutions and to establish an Indian Institute of Telecom Technology (IIT2) to drive research and develop industry-aligned courses on subjects such as telecom engineering, electronics design, artificial intelligence (AI), cybersecurity, 5G/6G, internet of things, and quantum communication. The NTP looks to position India among the top 10 global hubs for innovation and research in emerging technologies and to attain a 10 per cent global share in 6G-related intellectual property rights (IPRs).
Spectrum will be made available for captive non-public networks and private 5G for industrial use cases, and the testing and certification lab ecosystem will be harmonised with global requirements. The NTP will try to transform C-DOT into a telecom R&D institution of excellence to foster innovation in next-generation technologies. It will support the development of standard essential patents (SEPs) in emerging technologies by incentivising domestic R&D. This will also entail strengthening the Telecom Sectoral Skill Council to enhance workforce readiness, funding fellowships and training/skilling activities and ensuring skilling collaborations with the states.
The government will target R&D spends of Rs 10 billion per year – compared to Rs 4 billion in FY2026 – to support research in 5G/6G, quantum, blockchain, satellite communications, etc. It will accelerate public R&D investment by improving the utilisation of DBN, launch a technology readiness level funding programme and consider setting up a Sovereign Patent Fund with the objective of creating an SEP pool. It may look at out-of-the-box ideas such as accepting IPRs as collateral by financial institutions to support innovation.
Two funds – the Telecom Software Development Fund and the Sovereign Patent Fund – would help create a patent pool. The NTP also envisages introducing innovative financing models such as a fund of funds and blended finance to expand funding opportunities for startups. But going beyond these initiatives, the NTP must find as many ways as possible to encourage private enterprise to invest much more in R&D, whether through tax breaks or other incentives.
The NTP will create an innovation-centric Section 8 company and encourage (“handhold”) the creation of 500 tech startups and micro, small and medium enterprises specialising in telecom technologies. It will look to deploy indigenous technologies in at least 10 countries. This implies being globally very competitive in terms of value equation in the products and services being developed. There is an enormous gap to be closed in this area if India is to compete with the current leaders.
Generating employment is obviously desirable. Secure, reliable broadband has great positive externalities and will throw up new opportunities, create new revenue streams and enable startups. But it must be noted that new technologies such as AI, 5G/6G, reduce labour intensity, especially at the lower end of the chain. Combating this will mean upskilling to exploit opportunities in programming, solutions, data analytics, semiconductor design, etc.
That challenge extends beyond the telecom sector and requires a review and rebooting of the entire technical education ecosystem. Some of these technologies, such as quantum communications, are barely at proof of concept stage, while 6G is more an articulation of targets than even a proof-of-concept. There is indeed an enormous opportunity there, not only to play catch up but to outpace other nations in coming to the forefront. However, policymakers will have to find concrete ways to energise the latent talent embedded in India’s technically competent workforce.
India’s telecom networks should promote endpoint security for telecom network devices by deploying an indigenous endpoint detection and response solution, the NTP has proposed.
On the cybersecurity front, the importance of robust security cannot be over-emphasised. Security is a key pillar of the NTP. The policy mandates robust cybersecurity audits, biometric-based user verification, and faster response to telecom cyberthreats. A National Telecom SafeNet will be created to secure national infrastructure, and satellite networks will also be monitored for data protection and integrity.
The draft encourages the use and development of AI specifically for cyberspace, such as in cybersecurity, where AI is touted as both a challenge in offensive terms (such as through generative AI-fuelled bots attacking telecom networks), and in defensive strategies (such as systems that use AI to detect large attacks and thwart them at an early stage). It also suggests using AI in complaint resolution “through unified portal and use of chatbots”.
The entire Digital India concept depends on strong security and unfortunately, the high incidence of cybercrime at present suggests there are a lot of gaps in the frameworks. At least part of the problem is that the average citizen is under-educated and less aware of the pitfalls, and that has to be dealt with through awareness and digital literacy campaigns. However, new frameworks based on the adoption of AI and machine learning technologies, such as AI incident reporting, are also necessary. Strengthening security by adopting quantum-resistant cryptography will certainly help if proof of concept can be scaled sufficiently.
The NTP commits to reducing the telecom sector’s carbon footprint by 30 per cent, promoting renewable energy adoption for 30 per cent of telecom towers, integrating the sector with the Indian carbon market, and implementing a robust e-waste management framework. The ICT sector is very energy intensive and telecom infrastructure has to be made resilient to climate change impacts. Again, the goals are unexceptionable, and it is to be hoped that the policy can follow through on the ground and produce the desired results.
The NTP is designed to replace the NDCP, 2018, and the outcomes from that can serve as a good reference point. The gaps between goals and actual achievements are pointers to where the NDCP was unrealistic, and to the changes that will be required in implementation strategy if the NTP is to do better.
The execution bottlenecks must be addressed. This will require coordination among ministries, startups, academia and industry. There must be regulatory reforms to reduce red tape, promote infrastructure sharing, and simplify compliance for telecom providers. Only then can India fulfil its intention to shape global standards, expand its intellectual property portfolio, and deploy Indian telecom technologies across the world.
While the NTP is broad ranging, there is an absence of reference to spectrum pricing reform, and this could undermine operator viability. The role of private sector players is also not very clearly defined. The NTP also misses out on regulatory clarity on over-the-top platforms, digital content, and convergence in the telecom and broadcast spaces. Consumer protection requires more detail on privacy rights, redressal mechanisms and digital literacy. These are all areas where the draft could do with strengthening and better articulation.
Devangshu Datta
