Foreign investment in Indian telecom industry up 50% in 2011 to $1989 million

Telecom Lead India: Foreign direct investment in telecom sector in India
has increased by 49.9 percent to $1988.7 million during April-December 2011
against $1326.7 million in same period previous year.

The growth is significant as the year 2010 and 2011
witnessed maximum chaos in the telecom industry.

According to Indian government’s economic survey, during
fiscal 2010-11, FDI was $1664.5 million as compared with $2554 million in
2009-10 and $2558 million in 2008-09.

The economic survey noted that during 1991-2000, Indian
telecom attracted FDI worth $1089 million and during 2000-2010, FDI was $8915

Telecom sector in India attracts $1901 million through FDI till
September 2011

The liberalization efforts of the government are evident in
the growing share of the private sector in total telephone connections. As
against a meagre 5 percent in 1999, the share of private operators has
increased to 86 percent in December 2011.

A competitive stimulus provided by a liberal policy regime
has increased telecom penetration together with a substantial reduction in

CII urges telecom ministry to liberalize FDI in telecom sector

Recently, CII announced that the draft NTP 2011 policy is a
step forward to create a win-win ecosystem where the utmost beneficiary is the
subscriber. The association is seeking policy pronouncement on liberalization
of FDI into the sector.

The survey noted that the Indian telecom sector has
witnessed tremendous growth over the past decade. Today, the Indian telecom
network is the second largest in the world after China. A liberal policy regime
and involvement of the private sector have played an important role in
transforming this sector. The total number of telephones has increased from
429.73 million on 31st March 2009 to 926.55 million on 31st December 2011.

The growth of wireless connections has been phenomenal,
reaching 893.86 million connections at the end of December 2011. As a result,
the share of wireless telephones has increased from 80.3 per cent in March 2007
to 96.4 percent in December 2011. However, the growth of wire line connections
has been decreasing every year.

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