FDI in telecom sector registers 6-7 fold increase to cross $10 bn: Telecom Secretary

NEW DELHI: The foreign direct investment (FDI) attracted by the telecom sector in India has jumped to more than $10 billion (bn) in first eight months of 2016-17 registering a 6-7 fold increase as against $1.3 bn in 2014-15 and $2.9 bn in 2015-16, Telecom Secretary, J.S. Deepak said at an ASSOCHAM event held in New Delhi.

“The telecom sector reforms heralded by the Department of Telecommunications (DoT) have got a resounding acknowledgement and we hope that this will not only represents a word of confidence on what is being done in the area of policy regulations and reforms but also the commitment and a roadmap of further expansion of the work in telecom sector,” said Deepak while addressing an ‘ASSOCHAM National Summit on e-Governance & Digital India.’

He said that considering about 97 per cent of population is covered by the 2G telecom network provided mostly by private telecom operators, there is a need to both popularise and simplify USSD (unstructured supplementary service data).

“We need to work on a push USSD rather than a pull USSD, merchants should be able to push in a message to feature phone users where-in you just have to ok it for a transaction and it goes back and completes the transaction,” said Deepak.

“The burden of pressing keys and filling IFSC (Indian Financial System Code), MMID (Mobile Money Identifier) codes should move from the payer to the recipient and certain ceilings need to be removed to make it even more ubiquitous and universal,” he added.

“The announcement of demonetisation of November 8 has tremendous impact as far the war against black money and enhancing the tax net is concerned but it also has a very solitary impact of triggering the movement to digital payment system,” further said Deepak.

He also emphasised upon how the Digital India vision is helping in making government to citizen services presence-less, paperless and cashless.

“The availability of Aadhaar number, setting up of portals in number of languages in various departments, connectivity going down deep as well as availability of India Stack all of these have been brought together with the mission of making all government to citizen services fully automated online by early 2018 and this is very serious work in progress,” he said.

In his address at the ASSOCHAM summit, R.S. Sharma, chairman of the Telecom Regulatory Authority of India (TRAI) informed that his organisation is working along with the National Payments Corporation of India (NPCI) to simplify USSD transactions for 70 per cent feature phone users across India.

“We have recently done some work on the USSD payment gateways, TRAI has reduced the charges to one-third from Rs 1.50 to Rs 50 paisa and the number of steps in the transactions have also been increased from five to eight,” said Sharma.

“We have also requested the NPCI which is actually the payment gateway, in some sense the aggregator, we have requested them to create a taskforce, which they have done so, to simplify the USSD transactions to make it as friendly as UPI (unified payments interface) transactions or other kinds of payment transactions,” he said.

“When that happens 70 per cent of people who have still got feature phones, they will have a very friendly system to transfer money and do the banking from their feature phone and if they develop a trust in that, lot of acceleration can take place,” added Sharma.

“So we need to focus on that, it is a very critical infrastructure and we propose to work with NPCI and all the stakeholders to ensure that this happens fast,” he said further.

The TRAI chairman also said that demonetisation move of the government will certainly be a catalyst for Digital India.

“In the last two weeks or so, there has been acceleration in digital transactions, cashless society or in the short run the less cash society is actually one of the aims and objectives of Digital India, this I think is accelerating already,” said Sharma.

In his address at the ASSOCHAM event, Union Minister of State for Electronics and Information Technology (IT), P.P. Chaudhary said, “We need 5-7 crore merchant devices to make India a cashless society and bring about change in the entire country.”

He also suggested for the need to decentralise cyber security initiatives in India. “We need to invest time and money in promoting digital skill and awareness.”

While Y.S. Chowdary, Union Minister of State for Science & Technology and Earth Sciences in his address at the ASSOCHAM event said, “The success of digital India can only be seen when the divide is reduced.”

He also said that the growth accompanied by digitization must be inclusive. “Digitization should not widen the gap and create a rift in the society but it must be inclusive and must be used to bridge the existing gaps in all walks of our regular life.”

Jay Chen, CEO, Huawei India in his address said, “The key national initiatives like Digital India, Make in India, Smart Cities, Skill India have given an impetus to the Indian economy and has brought lot of confidence to both domestic and foreign investors.”

He said that India must step up the pedal in terms of ‘real investment,’ in the digital infrastructure and build and more digital foundations.

“India must lay strong emphasis on laying of fibre across the length and breadth of the country and connect as many citizens as possible to the digital broadband highway,” said Mr Chen.

“The recent policy on Right Of Way (ROW) is a huge positive step towards that direction and it should give necessary confidence to the industry to invest in this critical piece of digital infrastructure,” he added.

P Balaji, Chairman ASSOCHAM National Council on Telecommunication and Convergence, said, “The Prime Minister and the government of India set the vision for Digital India and have taken several pioneering initiatives towards actualizing it and to accelerate India’s progression into a less cash economy. A billion citizens, through their Mobile pre-paid accounts are already using digital currency in some form. The opportunity now is to drive this usage for other transactions and enable seamless conversion of cash into digital currency and vice a versa. Payment Banks and mobile wallets have an important role in enabling this. With appropriate policy changes, around 2 million retail outlets can easily become microtellers overnight. This can be a game changing move where the payment licensees can be leveraged to leapfrog to a cashless economy and catalyse the adoption of digital payments.

Deloitte Touche Tohmatsu India LLP released a report on “Digital India: Unlocking trillion dollar opportunity” on this occasion along with other dignitaries present at the event.

Deloitte spokesperson in India said, The tripod of 1 billion digital identities, 1 billion mobile and over 250 million bank accounts is waiting to unleash a very big digital revolution in India which will create a trillion dollar plus opportunity.

Considering the complex nature of the country and multiple central/state/local government and various private players operating with different technologies, the time is ripe for the country to have a Chief Information Officer (CIO) who can permeate the right infrastructure, comprehensive policies & services and ensure technological interoperability of key government functions across the country to ensure the success of India’s digitization program, said Deloitte Spokesperson in India.