The Department of Telecommunication's (DoT) is planning to launch a new broadbond policy. The Telecom Regulatory Authority of India (TRAI) has recommended a set of new policy changes. The policy will materialise once the cabinet officials approve and finalise the broadband cabinet note that has been submitted by DoT.
Sudhir Agarwal CEO of Wire and Wireless India Ltd (WWIL) in an exclusive interview with CNBC-TV18's Udayan Mukherjee and Mitali Mukherjee says that the recommendations made by TRAI are likely to bring growth in broadband penetrationand hence, “the change in the policy will help grow the sector.”
He further says, “Every 10% growth in broadband penetration increases the GDP per capita roughly by 1.5%.” He says the company sees tremendous opportunities in the broadband segment for business. “I see huge growth happening in wireless sector of broadband, and hence, going forward we will shift focus from wireline broadband to wireless,” he says.
Below is a verbatim transcript of Sudhir Agarwal’s interview with CNBC-TV18’s Udayan Mukherjee and Mitali Mukherjee. Also watch the accompanying video.
Q: What are the primary contents of the broadband policy? What are you expecting to see by way of policy changes?
A: The current broadband penetration in this country is less than 1% versus tele density which is over 60% right now. Every 10% growth in broadband penetration increases the GDP per capita by roughly 1.5% in developing economies and beyond metro towns we need high-speed data and information for citizens.
TRAI made valid recommendations to the government for creating a national fibre network across the country. It is a good initiative because this will help getting more investments into this sector, thereby taking broadband across the country to normal citizens. Couple of key points which they have highlighted is they have recommended that there should be 100% depreciation in the first year on customer premises equipment, they should provide special permissions for infrastructure to be created and companies need to create that infrastructure plus duty exemptions on customer premise equipment. Overall, these are good recommendations and will help grow the sector.
Q: Right now broadband is a very small proportion of companies like yours. How bigger business opportunity do you see it for yourself?
A: The current broadband business is in single digits for us, however, we see huge opportunities for broadband, and since very soon it will become a basic need. People will find it difficult to survive without broadband connections, it will become integrated part of their lives. So, we see tremendous opportunities in this segment for our business. I see huge growth in wireless sector of broadband. Currently, we focus more in the wireline sector of broadband. Going forward, the focus will be on wireless segment of broadband.
Q: How is the core business doing in terms of subscriber addition?
A: It is doing well and we are looking at strong growth for WWIL.
Q: Where is market share right now? What do you think you may do by the time you hit the end of the calendar year?
A: It will be positive growth for us.
Q: Are there any fund raising plans for the company?
A: The last time we raised funds were in end of 2009 and early 2010. We raised cash for the company and we are using that to bring our debts down and thereby, you will see constant decrease in interest cost for WWIL.
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