Connecting India: The telecom wave powering progress

The telecommunications sector is not merely evolving but being reimagined through groundbreaking technological advancements and visionary strategies. Telecommunications in India presents an attractive narrative of growth and potential. The country has made significant progress with 1,203.69 million total telephone subscribers and an overall teledensity of 85.43%.

Urban areas boast a teledensity of 132.94%, while rural regions have reached 59.05%. The Internet subscriber base has expanded to 969 million, with a remarkable 42% originating from rural areas, signalling profound digital democratisation. The telecom market is expected to reach USD 48.61 billion by the end of 2024 and grow to USD 76.16 billion by 2029.

5G: The Digital Transformation Catalyst

The 5G rollout represents a quantum leap in technological capabilities. With 385,888 base stations deployed, India has executed one of the world’s fastest 5G implementations. 5G technology in India is anticipated to generate a substantial economic impact, with estimated benefits of over USD 450 billion by 2040, primarily from creating smart cities, modern infrastructure, and autonomous ecosystems.

The technology is not merely about speed but about creating an interconnected ecosystem that supports advanced solutions like autonomous vehicles, smart city infrastructure, and sophisticated Internet of Things (IoT) networks. Telecom operators are leveraging Network Function Virtualisation (NFV) and Software-Defined Networking (SDN) to create more flexible, efficient, and adaptive network architectures.

Emerging Communication Technologies

The telecommunications landscape is witnessing a convergence of groundbreaking technologies. Globally, Li-Fi adoption is gaining pace, with companies like OLEDCOMM (France) and Signify (Netherlands) launching Li-Fi-enabled solutions. Quantum communication networks have been launched in China, Japan, and the UK, while Google and IBM are developing quantum-safe encryption platforms.

India’s Internet subscriber base has expanded to 969 million, with a remarkable 42% originating from rural areas, signalling profound digital democratisation.

Similarly, AT&T, T-Mobile and Verizon are exploring blockchain technology for secure data sharing and identity verification. OpenRAN technology is gaining traction for 5G and future networks. Artificial Intelligence (AI) is being integrated into network optimisation, customer service, and cybersecurity.

Edge computing has also emerged as a critical innovation. It processes data closer to its source to reduce latency and enhance security. With a projected market value of USD 43.4B by 2027, edge computing is being adopted in IoT, gaming, and autonomous vehicles.

Broadcasting and Digital

Content Ecosystem

The digital content consumption landscape has undergone a radical transformation. The OTT universe in India encompasses 547 million users, 60% of whom consume content primarily on mobile devices. The average user subscribes to 2.5 platforms, indicating a diverse and fragmented content consumption pattern. The number of OTT video users in India is expected to increase by 28.89% between 2024 and 2029, reaching 634.31 million users.

Cloud-based broadcasting services are enabling media companies to produce, manage, and distribute content with unprecedented flexibility. AI-driven content curation and personalised recommendation systems are enhancing user engagement and creating more targeted and immersive content experiences.

While urban areas lead in technology adoption and infrastructure, rural areas offer accelerated growth potential. The increasing affordability of smartphones and low-cost data plans, combined with government initiatives, are crucial to bridging the urban-rural divide in telecommunications.

Cloud-based broadcasting services are enabling media companies to produce, manage, and distribute content with unprecedented flexibility.

Programmes like BharatNet, Digital India, and spectrum auctions for 5G aim to bridge the urban-rural digital divide. In 2011, there was a nearly 130%-point gap in teledensity between urban and rural areas, which narrowed to 74% in 2024, showing a greater penetration in rural areas.

Satellite and Space Technology:

India’s Global Leap

Low Earth Orbit (LEO) satellite networks are redefining global connectivity. These satellite constellations promise global Internet coverage, particularly in remote and underserved areas. Private sector involvement in space exploration is accelerating, with companies developing advanced satellite technologies for earth observation, climate monitoring and global communication infrastructure.

By the next decade, the number of LEO satellites is forecast to reach or exceed 25,000 as a surge of investment in innovation makes them more commercially viable. The challenges in LEO projects, including regulatory and legal challenges such as orbital slot allocation, environmental concerns like rocket launch emissions, atmospheric pollution, cybersecurity, and privacy concerns, require a multifaceted approach. This includes technological innovation, stronger regulations, international cooperation, and greater public engagement. Addressing these challenges is critical to ensure that LEO projects can sustainably deliver their promised benefits.

Cybersecurity and Green Infrastructure

The digital transformation has necessitated robust cybersecurity frameworks. Zero-trust architecture, AI-driven threat detection, and advanced encryption technologies are being deployed to protect increasingly complex digital ecosystems. Organisations are adopting hybrid and multi-cloud strategies to enhance flexibility and optimise operational costs.

Sustainability has become a critical focus in digital infrastructure development. The goal is to create green, efficient, and environmentally responsible digital ecosystems. Telcos are adopting energy-efficient technologies, such as e-waste management and carbon offsetting, to minimise their carbon footprint. Energy consumption reduction and CO2 mitigation strategies are crucial for a green network.

Key players have set ambitious renewable energy targets: Bharti Airtel (50% by 2025), Vi (100% by 2030), and Reliance Jio (50% of towers powered by renewable energy by 2025). Also, Indus Towers and Bharti Infratel aim to deploy 50,000 and 30,000 green towers, respectively, by 2025. Further, using energy-efficient upcycling techniques to update current configurations offers a chance to advance the goal of carbon-free emissions.

The Strategic Implications

The telecom sector is the fourth-largest foreign direct investment sector, directly employing 2.2 million people and indirectly supporting 1.8 million jobs. Government initiatives such as Production Linked Incentive (PLI) Schemes and the BharatNet Project further promise to accelerate digital infrastructure development.

So far, 86% of gram panchayats—2,14,679 out of 2,50,000—have been connected through the BharatNet project, and 6,92,082 km of OFC has been laid. Additionally, 11,69,571 Fibre-To-The-Home connections are commissioned, and 1,04,574 Wi-Fi hotspots are installed to ensure last-mile connectivity. On the other hand, India’s mobile phone production value has overshot its target, reaching Rs 4.8 lakh crore in production value by March 2024, against the target of Rs 4.4 lakh crore.

Future Outlook: A Distinctly Indian

Digital Narrative

The Indian telecommunications sector is undergoing a significant transformation, driven by government initiatives and a vision to establish India as a global hub for telecom infrastructure and mobile device manufacturing. The PLI scheme has attracted investments and boosted domestic telecom equipment and mobile phone production. This initiative and programmes, such as Digital India, demonstrate the government’s commitment to fostering innovation in the sector.

India’s transition from a mobile phone importer to a significant exporter is a great outcome of these efforts. However, challenges in the sector persist, including low ARPU, high government levies and infrastructure gaps in rural areas. Concerted efforts by the government and industry to address these challenges and promote innovation will play a crucial role in shaping India’s communications landscape and economic outlook in 2025.

By Nittin Arora & Ankush Ajmera

Arora and Ajmera are associated with the Grant Thornton Bharat as its Partner and Associate Director, respectively.

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