Growth in rural tele-density has not kept pace

Despite being the world's fastest-growing cellular market in the world with around 1.5 crore new mobile subscribers being added every month, over 37,000 villages in India are still deprived of mobile telephony. As a result, rural tele-density has failed to match the growth of urban tele-density, thanks to the under-utilisation of the Universal Service Obligation Fund (USOF) set up by the Department of Telecommunications to expand mobile services in remote villages.

“37,184 villages in the country are yet to be connected with mobile connectivity as on March 2011…as on July 31, 2011, BSNL has covered all DHQ (district headquarter) and 33,620 cities/towns with GSM-based cellular services,” Minister of State for Communications and IT Milind Deora said in a written reply to a question in Parliament. There are over 5.93-lakh inhabited villages in India as per the Census 2001.

Orissa tops the chart with 7,573 uncovered villages, followed by Madhya Pradesh (5,843 villages) Himachal Pradesh (4,141), Jharkhand (3,316), Chhattisgarh (3,302), Arunachal Pradesh (2,215), Maharashtra (1,978), Assam (1,318), Meghalaya (1,252), Rajasthan (1,133) and Uttaranchal (1,115).

As per the Telecom Regulatory Authority of India (TRAI) figures, by the end of June 2011, India had over 85 crore mobile users — 56 crore in urban areas and 29 in rural areas. Overall mobile tele-density stood at 71 per cent – 155 per cent in urban areas and 34 per cent in rural areas.

In its latest report, the Parliamentary Standing Committee, looking after Ministry of Communications and Information Technology, has pointed out that the USO Fund set up in 2007 was to provide subsidy support for setting up and managing 7,871 number of infrastructure sites (towers) in 500 districts across 27 states for provision of mobile services in the specified rural and remote areas where there is no existing fixed wireless or mobile coverage. However, the targets were later scaled down to 7,363. The DoT informed that the Committee that as on February 28, 2011, 7,252 towers were set up under the USOF scheme.

But the Committee was not satisfied with the DoT reply and pointed out that “for the year 2010-11, an outlay of Rs.95 crore was provided at BE (budget estimates) stage which was reduced to Rs.90 crore at RE (revised estimate) stage. As on December, 2010, only Rs.63.33 crore has been spent. Out of the physical target of installing 265 mobile towers during 2010-11, only 138 towers could be installed as on December, 2010 i.e. only 52.10 per cent of the target. For the year 2011-12, an outlay of Rs.89.75 crore has been provided at the BE stage.”

“What is disheartening is the fact that in the last five years… the urban tele-density has shown a positive growth of 120.64 per cent which is almost four times that of the growth of rural tele-density. The Committee finds this highly disturbing. In spite of the rigorous work done in the last 9 years with the help of USOF, rural telephony has not shown the kind of growth which is expected,” it observed.