Overview

Sector Overview

chart diogram

Indian Telecommunication market is currently world’s second largest market with the subscription base of over 1.16 Billion as of June 2018, next to China.
Indian Telecommunications sector has registered strong growth in the past half-decade. It has added substantially to India’s Gross Domestic Product and Investments. As per report prepared by GSM Association (GSMA), growth of Indian Telecommunications is the result of rapidly growing Indian mobile market.

Telecommunications sector has grown rapidly in the past few years. With the strong growth in subscription base, Tele-density has also reached 89.72% overall as on June 2018. As per data released by TRAI, overall Tele-density has increased from 88.62% in May-18 to 89.72% at the end of Jun-18 where urban density has Increased from 156.49 to 158.16% and rural Tele-density has got up 57.18 to 57.99%.
State wise in overall Teledensity, Delhi is at the highest followed by Himachal Pradesh, Kerala, Punjab, Tamil Nadu, etc.
 

Overall Tele-density

Growth in Total Subscribers

Growth in Total Subscribers

Wireless Subscription (in millions)

Wireless Subscription

Source: Telecom Regulatory Authority of India

 

 
India has reached 3rd position worldwide for highest number of Internet users 493.96 million which is expected to reach 829 Million by 2021. As per a study conducted by Randstad India, Indian telecom sector is expected to generate four million direct and indirect jobs over the next five years.
Increasing smart phone penetration in rural areas, growing smart phone sales and internet users, creating both employment and investment opportunities in India and it is expected to rise more in the coming years.

 

Wireless Subscription Million

 
 

Key Trends in Indian Telecom Industry

  • Wireless subscriptions witnessed a CAGR of 19.62% and reached 1.2 Billion, during FY07-18. Wireless segment dominates the market accounting for 98.04% of total 1146.49 Million subscribers as on June, 2018. Wireless Tele-density has increased from 86.89 to 88% from May to June, 2018.
  • India has become the world’s fastest-growing market for mobile applications during 1st quarter of 2018.
  • India is the 2nd largest country in terms of internet subscribers with 493.96 million internet subscribers, as of March 2018
  • India is now the world’s 2nd largest smartphone market and is expected to have one billion unique mobile subscribers by 2020.
  • Revenues from Telecom sector have reached US$ 39.49 Billion in the year 2017-18. Revenues from the telecom equipment sector are expected to grow to US$ 26.38 billion by 2020.
  • Urban Tele-density recorded at 163.24% and Rural Tele-density at 57.47% as on February 2018.
  • According to the data released by Department of Industrial Policy and Promotion (DIPP), Indian Telecom industry has attracted FDI worth US$ 30.08 billion during the period April 2000 to December 2017

 

expectionasl
  • India is expected to emerge as a leading player in the world with 700 million internet users of the 4.7 billion Global users by 2025
  • Internet economy is expected to touch Rs 10 trillion (US$ 155 billion) by the end of 2018, contributing around 5% to India’s GDP
  • Indian Government is working to boost production of battery chargers and mobile phones in India which will result in setting up of 365 factories and generating 8 lacs jobs by 2025
  • Monthly data usage per smartphone in India is expected to reach 18 GB by 2023 from 3.9 in 2017-18.
  • Indian mobile industry is expected to create economic value of Rs 14 trillion (US$ 217.37 billion) by 2020

 

India will emerge as leading player in virtual world by having 700 million internet users with 4.7 billion global users by 2025 (Microsoft Report)

 

References – Data and reports available in the public domain including Ministries Annual Reports and Data Statistics, IBEF Sectoral Reports, Department of Industrial Policy and Promotion (DIPP), RBI handbook of Statistics on Indian Economy, Media & Industry Reports, Press Information Bureau (PIB), Union Budget 2018-19

Disclaimer – This information has been collected through secondary research and is available in the public domain. We are not responsible for any errors in the same.

 

Value Proposition/ Advantages for India

India’s Telecom Sector seeking huge benefits and opportunities because of the following advantages:

value bar telecom

 

Huge demand

Huge demand due to increasing Real Income and Changing Lifestyles of People. More and more people are adopting mobile and internet services in the country. GDP per capita is expected to grow from US$ 1,481.56 in 2012 to US$ 3,273.85 by the end of 2023. The emergence of an affluent middle class is triggering demand for the mobile and internet segments.

 

Growing Subscribers

Growing Mobile Subscribers in both Urban and Rural areas. India, where more than 70% population is living in rural areas, rural market is a key growth driver for telecom sector in the coming years.

 

Rise in Mobile Phones

Rise in Mobile Phones penetration and decline in data cost. Tower Industry has helped in reducing the operating cost and improved the capital structure in the country. High growth of telecom and internet services users both in urban and rural areas, resulted in high Mobile phones penetration in the country.

 

Government’s support

Government’s Proactive support through effective policies like relaxed FDI Policy, reduction in License Fee, Encouragement to Telecom companies to expand in rural areas, National Telecom Policy 2017, etc.

 

Strong Infrastructure

Country’s strong Telecommunication Infrastructure. In terms of telecommunication ratings, India is ahead of its peers in the West and Asia.

 

Cloud computing

Growth in Cloud computing and Indian Mobile Value-Added Services has high impact of increasing wireless subscriptions and internet users in the country. Rise of Telecom equipment’s and mobile application market. India have become the world’s fastest growing market for mobile applications in the first quarter of 2018. India’s apps downloads grew by nearly 215% between 2015 and 2017.

 

Growth drivers

Growing young population in India is also one of the major growth drivers of Telecom sector. Youth are more inclined towards Mobile and internet services specially Smart Phones.