Telecom firms have undertaken Rs 4.26 lakh crore capex in 2 financial years: Union Minister Jyotiraditya Scindia

Telecom operators have undertaken capital expenditure of over Rs 4.56 lakh crore in the last two financial years from moving on to 4G and then to 5G, Union Telecom Minister Jyotiraditya Scindia said on Monday. While speaking on achievements in the first 100 days of the third term of the NDA government led by Prime Minister Narendra Modi, Scindia said BSNL will complete the installation of 1 lakh towers for 4G service by mid-2025.

He also said that the ministry will not interfere in the state-run telecom firm decision on timeline for the roll out of 4G services and their business strategy.

The minister said that the voice call rates have dropped by 94 per cent in the last 10 years from 51 paise per minute to 3.5 paise, 1 GB of internet data has reduced by 97 per cent to 8.75 paise from Rs 297 per GB.

"Moving from 3G to 4G and 4G to 5G, telcos have undertaken a capex of over Rs 4.26 lakh crore just only over the last two fiscal. If you put in more investments there has to be a return," Scindia said when asked about tariff increase impact on affordability of mobile services.

The minister said connectivity under the last 10 years of the NDA government has increased while tariffs have come down drastically.

He said that the 11 per cent increase has had an impact of few paise on voice and data tariff compared to the services rates 10 years ago.

Private telecom operators Bharti Airtel, Vodafone Idea (VIL), Reliance Jio increased mobile services rates in the range of 10-27 per cent in July.

Bharti Airtel and VIL have increased entry-level tariffs by more than 100 per cent in the last three years from about Rs 99 to Rs 199 for around a month long use of mobile service.

Post tariff increase in July, BSNL has seen a surge of over 29.47 lakh subscribers while private telecom operators- Airtel, VIL and Jio together lost 38.65 lakh mobile customers.
Scindia said the telecom ministry will not intervene in BSNL's decision on business strategy.

"Launching of 4G, improving QoS (quality of service), garnering customers through mobile number portability, the key issue is also how it intends to retain its customers but all of that is in the domain of BSNL and its board. “All that we can do as telecom ministry is (to) advise, be there, strengthen them and we are more than happy to ensure that we conduct our fiduciary responsibility as the largest shareholder of BSNL. That's where I draw the line," he said.

The minister said that around 36,000 mobile towers for BSNL 4G services have been installed.

When asked about his view on the financial health of the telecom sector after the Supreme Court rejected VIL petition on adjusted gross revenue, Scindia said that the sector is extremely robust with four players.

"The judgement of the Hon'ble Supreme Court has just come out. It has been a couple of days. At this point of time, whatever the Supreme Court has ordained, according to that the process has to be executed. We are still going through the process of examining that and see what the repercussion of that is going to be," Scindia said.

He, however, said India's telecom sector is very robust with four players.

"I look at a very strong telecom sector moving forward which is why you have seen the fastest roll out of 5G in India. Close to about Rs 4.26 lakh crore worth of capital investment has occurred in the telecom sector," the minister said.

He said that in the last 100 days, 7,258 mobile towers have been installed that have connected 9,560 with mobile services till September 15.

The minister said that a total of 27,648 towers are required for 100 per cent saturation out of which 27 per cent rollout has been completed in the last 100 days.

Scindia said that India has become the 6th country globally that has established its own 4G technology.

Talking about the achievements under the telecom production linked incentive scheme, the ministers said around Rs 3,718 crore have been invested under the scheme leading to production of equipment worth about Rs 58,000 crore comprising export of Rs 11,506 crores and creation of around 22,000 direct employment.