With little impetus for Telecom in Budget 2018, little can it contribute to Digital India

The budget 2018 proposal tabled by the finance minister, Arun Jaitely, has nothing concrete to propose that could destress the telecom sector.  Though, in the long range, initiatives like setting up of test bed by DoT along with IIT Chennai for 5G technology indigenisation and Niti Aayog to be made the anchor organisation for driving AI and Machine Learning in India shall have a positive bearing as these are steps to make India future ready.

For the immediate benefit, the increase in imports duty from 15% to 20% on handsets is going to give more measureable reason for brands to Make in India.  Other than this, there is no such proposal that could support the Telecom sector to coup up with the legacy deficiencies while attempting to bring the latest to the consumers.

Telecom is a critical resource for Digital India.  Unless it is not strengthened and supported holistically through short, medium and long-range interventions, the sector would not be in a position to take forward the country towards a trillion-dollar digital economy with all its potential.  There is complete silence on providing any immediate relief to the sector which is facing rising liabilities as well as declining revenues.  In such a scenario, the sector shall only become weaker and won’t be able to employ full potential behind the transformation to a digital economy.

Even Start-up India and Smart Cities Mission programmes are going to find it difficult to maintain the pace of desired growth with a weak telecom sector.

The budget should have at least introduced proposals on how process of digitalising the half a billion of telecom users could be fast-tracked.  Any single impetus to the industry in this direction would have brought in a lot of enthusiasm in the sector and sow the seeds of changing the lives at the lowest level of strata in our economy.

Digital India is little of significance unless the lowest strata of the population is not meaningfully brought on to the landscape.  There is not better infrastructure than telecom that could result that. But, there are inherent challenges in bringing the economically weaker section on board. These challenges are less from technology and more from socio-economic profile of the intended users.  Hence, even if the operators bring in the best of the technology with very well-crafted business plans, government has to pull up the strings to uplift bridging the demand and supply gap.

At least for a while, Budget 2018 is a mute spectator on this challenge and this is no good news for the Telecom India.

Analyst Bio

Faisal Kawoosa, Head - New Initiatives
Faisal Kawoosa, Head - New Initiatives
Faisal drives new initiates at CMR. Having over 13 years of research and consulting expertise in technology domain, he specifically covers Telecom, IP Technologies, Devices, Electronics, Applications and other emerging technologies.

Faisal completed his Master’s degree in Business Administration, specializing in Marketing and Finance. He also holds a Bachelor’s degree in Business Administration.