Digital Connectivity in Rural India

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July 10, 2024

Why in News?

The Department of Telecommunications (DoT) has recently released draft rules to operationalise the Digital Bharat Nidhi.

What is Telecom and Digital connectivity? 

  • Telecom & Digital connectivity – A systems of interconnected communication devices and equipment that enable people to communicate with each other over long distances.
  • They facilitate the transmission of voice, data, and video signals between devices, including smartphones, computers, and other communication devices.
  • The foundation of digital transformation is telecom infrastructure.
    • Importance – It allows extensive access, fast data transfer, and seamless communication.
  • It propels the world's transition to a digitally empowered society.
  • Integrating cutting-edge technologies like cloud computing, artificial intelligence, and the Internet of Things promotes creativity and global connectedness across sectors.

Status of Telecom and Digital Connectivity in India

  • Global position – It secures 60th rank in Network Readiness Index 2023
  • It secures 2nd rank in Mobile broadband internet traffic within the country and in International Internet bandwidth.
  • Telecom sector – It is 2nd largest telecom industry in the world.
  • It is the 4th largest sector in terms of FDI inflows, contributing 6% of total FDI inflow.
  • 100% Foreign Direct Investment (FDI) has been allowed.
  • It contributes directly to 2.2 Mn employment and indirectly to 1.8 Mn jobs.
  • Teledensity - Telephone density is the number of telephone connections for every hundred individuals living within an area.
  • India has an overall tele-density of 85.76%,
    • Rural market - 59.44%
    • Urban market - 133.42%.
  • Internet subscribes - Till 2023, the total number of internet subscribers increased to 918.19 Mn (narrowband + broadband subscribers).
  • Out of total subscribers, 40.91% belong to the rural areas.
  • 5G network – It has been rolled out in all 28 states and 8 UTs.
  • India, in terms of median mobile broadband speed, has reached 43rd position.    
  • Data consumption - India is one of the highest consumers of data per day with approximately 5 hours of daily time spend on smartphones.

What are the steps taken to promote digital connectivity in rural India?

  • BharatNet - Connecting 250,000 village councils with high-speed broadband through optical fiber cables & Wi-Fi hotspots.
  • Digital India program - Transforming India into a digitally empowered society by providing e-governance services and establishing Common Service Centers (CSCs) at the village level.
  • USOF – Universal Service Obligation Fund is a pool of funds generated by a 5% Universal Service Levy charged upon all the telecom fund operators on their Adjusted Gross Revenue (AGR).
  • This money would be used to fund the expansion of telecom networks in remote and rural areas, where private companies resist to invest and develop.
  • PM-WANI – Expanding public Wi-Fi hotspots across rural areas with simplified processes for setting up Wi-Fi service providers.
  • Skill development and digital literacy – Enhancing digital literacy through programs like DISHA and PMGDISHA, offering digital skills training to rural populations.
  • Financial inclusion - Providing banking and financial services through digital means with projects like Jan Dhan Yojana, Aadhaar, and promoting digital payments.
  • Smart villages and digital villages - Developing model villages with comprehensive digital infrastructure and integrating digital technologies to improve rural life quality. 
  • Digital Bharat Nidhi – It is aimed at increasing telecom connectivity in rural areas.

Digital Bharat Nidhi

  • It will replace Universal Service Obligation Fund and has wider scope than USOF.
  • Objectives - Promoting access, affordability and delivery of telecommunication services in under-served rural, remote and urban areas.
  • Providing targeted access for underserved groups of society such as women, persons with disabilities and economically and socially weaker sections.
  • Funding research and development of telecommunication services, technologies, and products.
  • Supporting pilot projects, consultancy assistance and advisory support for improving connectivity.
  • Creation of regulatory sandboxes.
  • Developing and establishing relevant standards to meet national requirements and their standardisation in international standardisation bodies.
  • Encouraging start-ups including the manufacturing of telecom equipment, among other things.
  • Funding – As per the Telecom Act, contributions made by telecom companies towards this fund will first be credited to the Consolidated Fund of India (CFI).
  • The collected funds will be moved to the DBN from time to time.
  • Implementation – Centre will appoint an “administrator” who will select “DBN implementers” through “bidding” or invitation of applications from eligible persons.
  • Any DBN implementer receiving funding from the DBN for establishing, operating, maintaining, or expanding a telecommunication network shall be delivered on an open and non-discriminatory basis.

What impedes rural digital connectivity?

  • Infrastructure deficit – Still there are places which lack of basic infrastructure like electricity and roads, which can hinder the establishment and maintenance of telecom networks.
  • Geographical challenges - Difficult terrain, such as mountains and forests, makes infrastructure development challenging and expensive.
  • High implementation costs - The cost of laying fiber optic cables and setting up telecom towers in remote areas is high.
  • Underutilisation of USOF – It is primarily due to underspending on the BharatNet project for village fiber connectivity.    
  • Resistance by private companies – They resist in offering their services in rural and remote areas as they are not considered as revenue-generating markets.
  • Financial constraints - Lower income levels in rural areas limit the ability of residents to afford digital devices and internet services.
  • Security concerns - Vandalism and theft of telecom equipment and challenges in ensuring cybersecurity and protecting user data.

What lies ahead?

  • Enhance mobile connectivity - Setting up mobile towers in remote regions and partnering with private operators to extend mobile network coverage.
  • Provide satellite connectivity - Using satellite communication to provide connectivity in areas with challenging terrain for terrestrial infrastructure.
  • Develop localized content & applications – Local languages and locally relevant digital content can increase engagement. 


  1. The Indian Express | Digital Bharat Nidhi
  2. INVEST INDIA | India’s Telecom sector



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