Plan panel sees 25% rural teledensity

In a bid to bridge the digital divide in India, the Planning Commission is envisaging rural teledensity of 25 per cent from the meagre 1.86 per cent at present, and to provide a whopping 200 million rural telephone connections by 2012.

Mobile telephony would be a vehicle for increasing rural penetration and the commission proposes to support setting of infrastructure through the Universal Service Obligation Fund (USOF).

At present, there are over 14.75 million lines in rural India, including both landline and fixed wireless telephones.

This, however, excluded the number of mobile phones provided in rural areas, the Planning Commission's committee on telecom said in its draft discussion paper on approach to rural telephony under the 11th Five-Year Plan.

The draft report contains suggestions for preparing the 11th Five-Year Plan, that would come into effect from 2007 to 2012. It is being circulated among telecom players to seek their opinion, on receipt of which a final draft would be prepared and submitted to the government.

The committee has suggested supporting mobile telephony infrastructure in rural areas through the USOF, a fund that supports services like operation and maintenance of village public telephones and makes provisions for additional rural community phones. This is against the existing approach, as the USOF only supports fixed lines.

Commenting on the trends in the industry, the committee said mobile networks were amenable to competition, becoming affordable and due to the technological advances, were enabling commercial viability and low average revenue per users (ARPUs).

Moreover, the flexibility and ease of use offered by the pre-paid format and lower marginal cost of network roll out will also help in increasing the rural teledensity.

The cost of mobile handsets has reduced drastically, with handsets in below Rs 1,000 becoming a reality. Competition has led to the introduction of attractive packages and life-time free incoming schemes were also "widely accepted" in the country.

Broadband would be available on demand, with each village having at least one broadband-enabled kiosk and connectivity available to schools, health centres and panchayat offices in the next six years.

It also plans to provide broadband connectivity to schools, health centres and panchayat offices in the next six years. The committee on telecom has also suggested using the USOF for a broadband foray.