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Big growth seen for Indian long-distance telecom

India's domestic long distance telecommunications market is expected to grow to Rs 208 billion ($4.46 billion) by 2004-05 from Rs 126 billion in 1999-00, according to a report released on Wednesday.

However, projected average long distance call prices are expected to fall by 31 per cent by March 2005 from March 2000 levels, said the study, prepared by CRIS INFAC, a research arm of the Credit Rating Information Services of India Ltd.

The study said that of the total market, the inter-circle market for DLD services -- or the traffic between 2 telecom licence areas -- was projected to rise to Rs 135 billion by 2004-5 from Rs 84 billion in 1999-00.

But the report said there would be questions about the profitability in the industry if there were too many players providing long distance voice services.

"The market for facility-based switched DLD voice services would not be able to support more than three service providers other than Bharat Sanchar Nigam Ltd, due to the large investment requirements and declining long distance call prices," it said.

State-owned BSNL which provides fixed line services throughout India, except in Bombay and New Delhi, is the country's largest telecom firm. Once voice-over-Internet protocol services are introduced, there is likely to be a sharp fall in call prices, the report said.

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