The Broadband India Forum (BIF) on Friday said the government should incentivise internet service providers (ISP) for rural broadband expansion and offer tax breaks to them.
The same assumes significance for last-mile broadband connectivity of users by ISPs, for whom rural expansion otherwise would be difficult from a commercial point of view.
“Reward ISPs for exceeding a minimum of 20% year-over-year rural subscriber growth within their licence area and incentivise rapid rural expansion through higher tiers based on achieved growth percentages,” BIF said in a recent paper on “Digital Infrastructure Investing in the Future for a Viksit Bharat”. The report was prepared by public policy consulting firm The Quantum Hub (TQH) for one of BIF’s specialist committees.
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“Additionally, tax breaks for ISPs that consistently demonstrate significant growth in rural subscribers is recommended,” the report said, pushing for the need to increase fiberisation which is currently at 33%.
BIF represents technology companies and ISPs such as Meta, Google, Amazon, ACT Fibernet, and Nelco.
In the report, TQH and BIF recommended supporting last-mile connectivity through initiatives like the Prime Minister’s Wi-Fi Access Network Interface (PM-WANI) by lowering internet bandwidth costs for public data offices. It said satellite-based broadband in rural areas should also be supported by the government .
Aruna Sundararajan, chairperson of BIF, said, “As India targets the digital economy to grow to the $1 trillion mark and to contribute 20% of GDP by 2026-27, it is imperative to focus on the proliferation of a robust, reliable, and high speed and inclusive broadband for all—both in rural and urban areas.”
“Central to this goal is the need for rapid expansion of fixed broadband infrastructure across the country,” Sundararajan added.
Currently, India’s digital growth remains mobile-first, with 95.6% of users relying on mobile internet compared to only 4.3% using wireline broadband. Experts say the same highlights a significant infrastructure gap as fixed broadband is essential for fast speed internet and in areas where mobile connectivity is poor.
As per studies on growth dividends from mobile penetration in India, a 10% increase in internet subscribers leads to a 3.2% increase in the rate of growth of per capita GDP. Therefore, India must cultivate an inclusive internet ecosystem that emphasizes meaningful ubiquitous connectivity, going beyond basic access to ensure reliable and affordable connections, the report said.
For universal connectivity, the report emphasised on robust digital infrastructure with three interconnected components: the backbone (high-capacity fiber-optic cables), the middle mile (data centers, content delivery networks, and internet exchange points), and the last mile (wireless and wireline connectivity).
Among other recommendations, BIF has recommended expanding content delivery networks, data centers, and internet exchange points to meet rising broadband demand, reducing latency and improving internet access, especially in remote areas.
Open access to submarine cable landing stations and promoting domestic cables will prevent monopolies and strengthen connectivity. Collaborative investments and diversified landing points can reduce failure risks, the report said.