Thiru. Nripendra Misra, Secretary, Department of Telecommunications, Thiru A.K. Sinha, CMD, BSNL, Thiru. Indra Mohan, President, India-Tech Foundation Thiru. Ash Khalek of Oracle Corporation Thiru. Prithipal Singh, Convenor, TELECOMM India 2004 Distinguished delegates, Leaders of Indian Industry, Members of the media, Ladies and Gentlemen,

1. It gives me great pleasure to be with all of you at this Telecom India event. I am happy to see several important personalities gathered here.
2. When we look at the Telecom scenario today, we find ourselves on an optimistic plane. Apart from the fact that we in India are on the verge of a great expansion, technology-wise too, this is one sector where the gap between the other developed nations and us is minimal. This has been possible due to the policies we have pursued over the years beginning with the early ‘90s, which have enabled us to transform the sector from a purely Government monopoly to a vibrant competitive regime with multiple players. The entry of the private sector has had a very positive effect and I am happy that all the players, both in the Private and Public sectors are aggressively competing with each other. The result has been an impressive growth in tele-density, and an equally significant reduction in the price of telecom services. The tele-density has grown from under 2 in the year 1998 to the current level of 8. We are presently adding nearly 2 million telephones every month. The tariffs as well as the equipment prices are far lower than what they were a few years ago. Last week, the wireless sector had overtaken the fixed line service in the country. There has been a surge of private investment in Telecom sector, which is estimated at nearly US $ 35 billion, coupled with the presence of all leading equipment and handset vendors in India.

3. A rapid expansion of Telecom network has unlocked the potential of Business Process Outsourcing (BPO) and infotech services. We are among the world’s leading providers of Business Process and Infotech services. If we have to maintain our edge, the Telecom juggernaut has to keep rolling, with consistently improving coverage, penetration and quality of service.

4. Such a growth naturally calls for a significant increase in the investment in the Telecom sector. Our current estimates are that an additional investment of about Rs. 1,60,000 crore would be required to reach a target of 200 million telephones by 2007. Besides, we are aiming at a rapid growth of Internet and Broadband, with 10 million Broadband and 20 million Internet connections by 2007.

5.Obviously, the investment cannot be met entirely by domestic capital. Addition of FDI in the Telecom sector is essential to the over all capital formation in the country. The total FDI in the Telecom sector till date has been of the order of only US $ 2.5 billion. We are currently working to increase this investment. The Finance Minister has already announced raising the FDI cap from 49% to 74% in Basic, Cellular, National and International Long distance services. I am sure all of you are eagerly awaiting the modalities. Various Studies clearly indicate that the current investment climate in India is conducive to such investments being made, and that Indian Stocks have been performing well. We are seen as a major investment destination in the world and particularly Asia.

6. There are a few aspects of the Telecom sector, that I must admit, bother me. One of these is the virtual lack of indigenous manufacturing of Telecom equipments. I am concerned that even as we are planning for major investments in this sector, our own companies are not in a position to take advantage of such investments, and that the benefit will essentially accrue to the other countries. I need not recall to you that from April next year, the Duties on Telecom equipment will be zero. If measures are not taken soon, the bulk of equipments required would continue to be imported. Recently we had organised a Conference on Development of Telecom Equipments Manufacturing Sector, to identify the issues hampering the growth of manufacturing in India and to chart out the action plan required for the Telecom equipment-manufacturing sector to share the explosive growth being enjoyed by the Telecom sector in India. Certain measures were identified and recommendations made and I assure you that we would be pursuing the various recommendations. But a proactive approach from the Industry is also called for. You must not rest content with imports but actually persuade your partners or suppliers that their interest would lie in local manufacture. I must, however, acknowledge that I perceive a change. Several multinationals have been, during their discussions with me, indicating that they are considering India as a manufacturing destination. I urge all of you that indigenous manufacture must not be a fleeting idea but a concerted action. I can assure you that I will be with you all the way and that I shall personally ensure that the impediments in your path are removed and that your interests are protected.

7. We also need to invest more in our R&D. While in the past two decades C-DoT has done significant work in developing various technologies with special emphasis on rural areas, there has not been any major effort from the private sector. A look at the Pharmaceutical sector demonstrates the advantages of a strong R&D base. There is scope to augment the R & D efforts by a public-private partnership.

8. I now turn to the critical problem of the digital divide. True, there are several dimensions to this problem. But, the lack of ubiquitous communication facilities is something that we cannot afford to continue. The economic growth of this country is going to be heavily dependent on how the rural sector performs, and provision of good quality and reliable telecom facilities is a prerequisite. The provision of communication facilities in the rural areas cannot be the concern of only the Public Sector undertakings. Irrespective of the licence conditions, I expect all the firms to be active partners in this exercise. Please let us have your suggestions. I can assure you that we will look at them with an open mind. But to shy away from this national responsibility is something that I would urge you, not to do. Let us look at the various technological, and economic aspects and see how we can achieve a paradigm shift.

9. A few days ago, I had announced our Broadband Policy. I am happy it has generated a lively debate. It is a clear indiation that we are responding to the needs of the situation. Views can differ. In fact, they should. Only through an active dialogue can we bring about improvements. I am happy that we have now set a benchmark for broadband at 256 Kbps, which is far higher than what was understood to be broadband till now. This too is only the minimum standard. Today, technologies and equipments are available to raise the data transfer speeds to - 8 to 11 Mbps. Irrespective of the details, we must make broadband a key ingredient in our development process. It hould not be confined to the urban or the rich. Nor should it remain, at least for the vast majority, as only a source of entertainment. We have to build our country and do so quickly. Investments in Education, Health and Governance must undergo an appreciation through the use of broadband. This calls for action by several players. I am aware that broadband can be a chicken and egg problem. But, I am confident that content development will follow and quickly too. The Indian mind is fairly innovative and I call upon our entrepreneurs to take this up as a major opportunity.

10. I know, this is not easy. Even major companies like AOL Time Warner have difficulty in designing the online content and services that mainstream consumers will be willing to pay for. There are also various other distortions that are creeping into the usage of the Internet facilities. I am happy that during the next two days, you are discussing several issues relating to Internet and Spam. There are people who feel that Cyberspace is "debasing itself in front of our eyes," and that "We will lose the Internet if we don't save it." The problem with the human mind is that it is capable of using technology to alleviate misery and with equal ease using it for lowbrow and indeed harmful activities. Every new technology brings, in its wake, hope as well as fears. It is for us to lay down procedures and safeguards to ensure that it is put to the best use of our citizens.

11. You can thus see that beyond the optimistic outlook of our Telecom scenario, there are several challenges that we must face up to. I hope that the deliberations over the next two days will throw up some pointers for concerted action. I wish the deliberations all success.

Thank you.