The political economy of India's telecommunication reforms

The new Indian telecommunications policy is one of the most interesting telecommunications reform programs in the developing world. It begins the restructuring process by introducing competition in the local loop, and forces Indian and foreign companies to form joint ventures to provide basic services. Instead of licensing one or two companies to provide services nationally, the government plans to grant separate licences for 18 regions, holding out the potential for a number of different providers to enter the market. Finally, it avoids privatization of the government PTT, which will continue to provide services in head-to-head competition with the private telcos. The first section of this paper introduces the broad parameters of the institutional approach; the second briefly describes the government's new economic policies; and the third assesses the structural, technical, regulatory and service components of the government's new telecommunications policy from an institutional perspective.