The Indian telecom market size of over Rs 400 billion is expected to treble itself by year 2011-2012, according to Ernst & Young.
"The Indian telecom market size of over Rs 400 billion is expected to treble itself by financial year 2012. Thus there is a significant opportunity for telecom players in the Indian market, but the sectoral pie would change," Sanjay Mehta, Partner, Ernst & Young said in a research paper on 'Telecom Trends' presented at CII telecom summit in New Delhi.
Mehta said that the year 2002 had been a landmark year for Indian telecom, and although lot needed to be done from the regulatory standpoint, developments such as opening up of international long distance sector and reduction in tariffs, had fuelled growth and intensified competition.
"The cellular subscribers are projected to grow at a compounded annual growth rate of 48 per cent to exceed 45 million in financial year 2007 and at 30 per cent to cross the 88 million mark in financial year 2012," it said.
Also the basic subscriber base of 40 million is expected to grow to 58 million in financial year 2007 and 86 million in financial year 2012.
Spectrum allocation, licence fee and USO obligation were key regulatory issues, it said, adding that foreign direct investment cap of 49 per cent for the telecom sector should also be hiked to 74 per cent.