India Grinds to a Halt

India is undoubtedly one of the most exciting communications services markets in the world, with ongoing mobile growth, the impending launch of Long Term Evolution Time Division Duplex (LTE TDD) services and multiple plans in the pipeline to boost the currently very low broadband penetration (about 1 percent of the population of 1.2 billion). (See India Reaches 900 Million Lines.)

But despite all this, India's telecom sector has come to something of a halt, albeit temporarily. In fact, Sandeep Girotra, head - Region India at Nokia Networks , noted during a presentation at the recent India Telecom event in New Delhi that India's telecom market had come to a "grinding halt." (See Sandeep Girotra, Head - Region India, NSN, India Telecom: Day 1 Pictures, India Telecom: Orckit Still Bullish on India, India Telecom: More Pictures! and India Telecom: GPON's All the Rage.)

Girotra was referring to the current reluctance of India's mobile operators to make any network expansion or upgrade decisions while there is an air of uncertainty hanging over the sector.

That uncertainty stems from ongoing discussions between the country's Department of Telecommunications and many of the country's major operators about issues such as 3G roaming disputes, rollout obligations, additional spectrum awards, and more.

In addition, the new National Telecom Policy that was set to clear up many grey areas, such as M&A rules, spectrum sharing and local manufacturing rules, is still being discussed and will miss its end-of-year deadline. Without clarity on a number of important issues covered by the policy, India's operators don't want to finalize investment decisions in case they find they have wasted their money. (See IndiaWatch: NTP Delayed Further, NTP 2011: An Open Letter to the Telecom Minister and NTP 2011: Strong Action Plan Required.)

As a result, the vendor community has been experiencing a dip in activity lately. The consensus, though, is that various bottlenecks will clear within the next few months, with additional 3G investments and the initial major orders for LTE TDD technology feeding through from the country's Broadband Wireless Access (BWA) license holders. (See Chip Vendors Rev Up for LTE Market, Rumor: Bharti Plans LTE Soft Launch in 4 Cities and Report: 17 Million LTE Users in India by 2016.)

For all the latest news and views from the Indian market, check out Light Reading India, written and produced by a local team in Delhi and Mumbai.

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— Ray Le Maistre, International Managing Editor, Light Reading

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