The telecom industry in India is witnessing rapid growth. India is today the world’s second largest telecommunication market, with 1,177.02 million total subscribers as of January 2020. The telecommunications industry can be divided into three segments—mobile, wireline, and wireless (internet) services. As of January 2020, the wireless market in India accounted for 98.25% of the total subscriber base, and rural subscribers comprised of 43.69% of the total telephone subscribers, according to a TRAI (Telecom Regulatory Authority of India) report[1].

With ‘work from home’ becoming the new normal in view of the Covid-19 pandemic, telecom services and the internet have become vital for everyday life. The telecom sector is being used by the government to spread awareness about the pandemic, as well as to trace and track infected people to break the chain of transmission. Despite the crucial role played by the telecom sector during the period of lockdown, the pandemic has also adversely affected telecom service providers, from mobile to internet service.

The industry lost around 2.8 million subscribers during the month of March, and 8.2 million subscribers during April 2020, according to an India Ratings and Research report[2]. The telecom operators most affected were Vodafone Idea Ltd and Bharti Airtel Ltd. However, Reliance Jio witnessed an increase in its subscriber base during the same period.

India had over 500 million active internet users (they accessed the Internet in the last one month) as of May 2020, according to IBEF (India Brand Equity Foundation)[3]. Despite the downturn, telecommunications experts believe the Indian telecom market will maintain steadiness, thanks to the dynamic nature of the industry.

According to the global telecom industry body GSMA, India is expected to become the second-largest smartphone market globally by 2025, with around one billion installed devices. The report also said India is expected to have 920 million unique mobile subscribers by 2025, which will include 88 million 5G connections. The social distancing measures due to the pandemic have led to higher dependence on digital tools, like video conferencing and webinars, which in turn has increased the demand for telecom services. However, the telecom sector is also facing some major hurdles due to the pandemic, government regulations and customer acquisition.

Apart from inadequate internet penetration, there is a significant gap in user subscription of mobile sim cards. The estimates, according to the GSMA Report 2020, indicate that there is 78% mobile connection penetration across the country. It is a common occurrence for people to have more than one sim card. So, we can infer that in 2019, for every 100 persons, around 78 of them had sim connections. This does not mean that they all used smartphones or availed of internet facility. The smartphone adoption in 2019 stands at 67%, 4G use at 56%, 3G at 11%, while there is a strikingly large figure for 2G use— at 33%, according to GSMA report 2019[4].

Even as the world is moving towards 5G, in India the usage of 4G internet has not been optimal. There is huge scope for digitalisation in our country provided these services are properly utilised. The paper analyses the current standing of the mobile industry in India. Primarily looking at the GSMA 2020 and IBEF reports, the paper attempts to understand the growth, opportunities, challenges of the mobile sector in India, including the emergence of 5G technology. The paper also attempts to analyse the telecom industry’s response to the Covid-19 pandemic.

[1] Telecom Regulatory Authority of India (TRAI) 2020;

[2] Economic Times;

Telecom industry loses 82 lakh subscribers in April, pressure to continue: Report;

[3] IBEF Report

[4] The State of Mobile Internet Connectivity 2019;

Date: 23rd November 2020
Author: Meghna
Reviewer: Ritu Srivastava

Focus Areas: Digital Access
What We Do: Research & Advocacy
Resource Type: Research Analysis