Lok Sabha Question No. 178 (STARRED), answered on 2018-03-07
Subject: Employment Opportunities in Telecom Sector
Ministry: COMMUNICATIONS
Asked by: CHANDRAKANT BHAURAO KHAIRE

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF TELECOMMUNICATIONS

## LOK  SABHA STARRED QUESTION NO. 178 TO BE ANSWERED ON 7 th  MARCH, 2018

## EMPLOYMENT OPPORTUNITIES IN TELECOM SECTOR

†*178. SHRI CHANDRAKANT KHAIRE:

Will the Minister of COMMUNICATIONS be pleased to state:

(a) whether a large number of people have become jobless in the telecom sector during the last three years;

(b) if so, the details thereof, year and State/UT-wise;

(c) whether the employment opportunities in the said sector are likely to increase in view of the emergence of new technologies and if so, the details thereof;

(d) the total investment made in telecom sector during the said period; and

(e) the number of telecom companies shut down or merged with other companies during the said period?

## ANSWER

## THE MINISTER OF STATE (IC) OF THE MINISTRY OF COMMUNICATIONS & MINISTER OF STATE IN THE MINISTRY OF RAILWAYS (SHRI MANOJ SINHA)

(a) to (e) A statement is laid on the table of the House.

Contd………2/-

STATEMENT TO BE LAID ON THE TABLE OF LOK SABHA IN RESPECT OF PART (a) to (e)  OF  LOK  SABHA  STARRED  QUESTION  NO.  *178  FOR  7 TH MARCH,  2018  ON 'EMPLOYMENT OPPORTUNITIES IN TELECOM SECTOR'.

(a) & (b) The Telecom sector is one of the highly competitive high-tech sector and is  currently  going  through  a  phase  of  consolidation  with  mergers  and  acquisitions happening among various companies. Mergers and acquisitions can have an impact on certain  specific  telecom  service  providers.  New  entrants  also  tend  to  shake  up  the market; however, they also create direct and indirect employment opportunities. Overall, it  may  be mentioned that there is a vast potential for growth in this sector, especially with  the  increasing  convergence  in  voice  and  data  and  related  technologies  and  the consequent demand for telecom services.

Keeping in view the need for better connectivity and for  increasing the potential for further growth, the Government is implementing programmes to improve connectivity through its flagship project 'BharatNet' which aims at linking each of the 2.5 lakh Gram Panchayats of India through a vast optical fibre network that in turn would boost  various economic activities in the rural sector.  This endeavour will open up avenues for better access  for  service  providers  such  as  telecom  operators,  cable  TV  operators,  ecommerce  companies,  etc.  to  launch  new  services  and  in  turn  aid  creation  of  local employment opportunities. Other flagship schemes of the Government like Digital India, Make-in-India and Smart Cities also are expected to create employment opportunities in telecom sector.

(c ) As  per  'Skill  Plan'  of  Department  of  Telecommunication,  prepared  based  on inputs  from  Environmental  Scan  Report-2016  of  Ministry  of  Skill  Development  and Entrepreneurship  (MSDE),  assessment  of  Indian  Cellular  Association  (ICA),  Telecom Sector Skill Council (TSSC),  an additional skilled manpower requirement  to the tune of 47,75,500 from the present strength of 40,04,500 is estimated in telecom sector till the end  of  financial  year  2021-22,    meaning  thereby  an  increase  of  119.25%  over  the present strength in a period of five financial years.

(d) Telecom sector comprises telecom services sector and telecom manufacturing sector. Foreign Direct Investment (FDI) up to 100% is permitted in telecom equipment manufacturing via  automatic  route.  Under  the automatic  route,  investment  in  telecom equipment  manufacturing  can  be  made  in  the  country  without  prior  approval  of  the Government. Moreover, FDI is largely a matter of private business decisions.

As per the audited/unaudited financial information submitted by licensed telecom service providers submitted to TRAI, the capital investment in the last three years is as under.  However,  these  figures  do  not  reflect  the  capital  investment  for  the  entire telecom sector.

| Capital investment (Gross Block* in Capital Work in Progress) (Rs in Cr)   | Capital investment (Gross Block* in Capital Work in Progress) (Rs in Cr)   | Capital investment (Gross Block* in Capital Work in Progress) (Rs in Cr)   |
|----------------------------------------------------------------------------|----------------------------------------------------------------------------|----------------------------------------------------------------------------|
| S.No                                                                       | Year                                                                       | Capital Investment in Rs Cr                                                |
| 1                                                                          | 2014-15                                                                    | 726400                                                                     |
| 2                                                                          | 2015-16                                                                    | 913814                                                                     |
| 3                                                                          | 2016-17                                                                    | 1044027                                                                    |

*The total value of acquiring all fixed assets (even though a different points of time)  is  called  ''Gross  Block'  or  'Gross  Fixed  Asset'.  The  worth  of  the  fixed assets after providing for depreciation is called 'Net Block'.

The FDI equity inflow in the telecom sector for the last 3 years and current year (as obtained from DIPP website) is as under:

| Year              | FDI Equity inflow (in Rs. Crores)   |
|-------------------|-------------------------------------|
| 2014-15           | 17,372                              |
| 2015-16           | 8,637                               |
| 2016-17           | 37,435                              |
| Apr 2017-Dec 2017 | 39,264                              |

## INVESTMENTS MADE BY GOVERNMENT IN ITI LTD

The Cabinet Committee on Economic Affairs (CCEA) had approved capital grant of Rs 2264 Cr to be given in the form of equity for project implementation (CAPEX) to ITI  Ltd.  for  upgrading its  manufacturing infrastructure and new projects for its revival. Out of this, an amount of Rs 472 Cr has so far been released to ITI during the last three years. In addition to the above, MoF has made the following budget allocation for F.Y 2018-19 , in the form of equity:

- i. Rs 137 Cr in R.E of 2017-18
- ii. Rs 100 Cr in B.E of 2018-19

The status of funds released to ITI  against  this  approval  in  the  last  years  and current year is as under:

|   S.No | Year    | Equity Infusion in Rs Cr   |
|--------|---------|----------------------------|
|      1 | 2014-15 | 192                        |
|      2 | 2015-16 | --                         |
|      3 | 2016-17 | 80                         |
|      4 | 2017-18 | 200                        |

## USOF SUBSIDIES DISBURSED IN LAST THREE YEARS

Under  the  various  schemes  of  USOF,  the  following  subsidies  have  been released during the last 3 years, primarily for creating infrastructure in rural and remote areas.

| Year    |   Subsidy disbursed (Rs in Crores) |
|---------|------------------------------------|
| 2014-15 |                            2086.98 |
| 2015-16 |                            3100    |
| 2016-17 |                            7227.03 |

(e) During the last three years, four telecom companies have closed down telecom operations,  three  companies  were  acquired/merged  and  seven  companies  are  in  the process of merger. Details are available in Annexure- I.

-4-

## Annexure-I

1. During  the  last  three  years,  the  following  companies  closed  down  their  telecom operations:
2. (i) M/s  Videocon  closed  down  services  in  the  services  areas  of  Gujarat,  UP (West), Madhya Pradesh, UP (East), Bihar and Haryana in 2016.
3. (ii) M/s Quadrant Teleservices has closed down GSM services in Punjab service area in 2017.
4. (iii) M/s Reliance Communications Ltd has closed down voice services in 2017.
5. (iv) M/s  Aircel  Limited  has  closed  down  telecom  services  in  service  areas  of Gujarat,  Haryana,  Madhya  Pradesh,  Himachal  Pradesh,  Uttar  Pradesh (West) and Maharashtra in January, 2018. The taking on record of surrender of licenses is under process in the Department of Telecommunications.
2. During  the  last  three  years,  the  following  telecom  companies  were  merged/ acquired.
7. (i) M/s Sistema Shyam Tele Limited (M/s SSTL) was acquired by M/s Reliance Communications Limited (M/s RCOM) in 2017
8. (ii) Infotel  Telecom  limited  (ITL)  merged  with  Reliance  Jio  Infocomm  Limited (RJIL) in 2017.
9. (iii) M/s  Augere  Wireless  Broadband  Services  India  Pvt.  Ltd  merged  with  M/s Bharti Airtel Limited in 2017.
3. The following telecom companies are in the process of merger:
11. (i) Merger of M/s Tikona Digital Networks Private Ltd. with M/s Bharti Airtel Ltd.
12. (ii) Merger of M/s Telenor (India) Communication Private Limited with M/s Bharti Airtel Limited
13. (iii) Merger  of  M/s  Vodafone  India  Limited  &  M/s  Vodafone  Mobile  Services Limited with M/s Idea cellular Limited
14. (iv) Demerger of telecom business of M/s Reliance Telecom Limited in 5 service areas namely Bihar, Himachal Pradesh, Madhya Pradesh, Orissa and West Bengal and merger of the same into  M/s Reliance communications Limited
15. (v) Merger  of  M/s  Airtel  Broadband  Services  Private  Limited  with  M/s  Bharti Airtel Limited
16. (vi) Merger of Vodafone Group entities into Vodafone Mobile Services Limited
17. (vii) Merger of  M/s  Aircel  cellular  Limited  and  M/s  Aircel  Limited  consequent  to merger of  Chennai service area with Tamilnadu service area

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