India needs more Internet infrastructure says new report

Fast and affordable access to the Internet remains a luxury mainly for India's urban elite, a new report says, and most families still can't even afford a computer.

As India's economy continues to blossom, the report by global management consultancy Booz and Company warns that the country could be held back by the lack of mass access to the Internet.

In a nation of over a billion, only around seven million people are broadband Internet subscribers, and most are concentrated around central business districts and high-end residential areas.

The government aims to boost this to 20 million by the end of the year and is also auctioning off the broadband spectrum.

But more needs to be done to encourage investment in infrastructure, researchers say, as India only has around 45 million fixed lines.

"India simply does not have a sufficiently large base of wired households ready to upgrade," the report says.

There are also around 90 million cable subscribers but most of the systems are analogue and unregulated, researchers say, and the vested interests of a handful of operators may often want to keep it that way.

"A lot of local cable operators are unorganised local groups," Ashish Sharma, one of the report's authors, told AFP Tuesday.

"It is often not in their immediate interest to upgrade and digitise as this would make subscription figures transparent."

It is believed some operators do not pay the correct fees for the content they use - and digital usage can be measured a lot more easily than analogue.

"Only the government can step in and force through the necessary changes," Sharma added. "The lack of fast and affordable Internet access will hold the country back.

"There will be no mass penetration of broadband unless the government makes fixed line infrastructure attractive to investors and cracks down on vested interests."

Broadband costs less in India than in most countries, but is still way out of reach of most people in a country where the 500 dollar cost of a locally-made computer is more than the monthly income of an average middle-class household, the report says.

The report adds "broadband is almost a class phenomenon, with semi-urban and rural areas virtually excluded."