India aiming to sharply expand its national broadband network as it seeks a "revolution" to bring high-speed Internet to the country's rural heartland. India is the world's fastest-growing cellular market with some 700 million people having mobile phone services but Internet penetration has trailed badly. At present, the number of broadband connections stands at only 10.3 million.i.e., penetration of broadband is just 0.8 per cent as against the tele-density of 60.99 as of September, 2010. . The number of broadband connections is only one crore as against a target of two crore by the year 2010. The left-leaning Congress government sees access to broadband as a way to bolster education, health care, banking and other services and help lift hundreds of millions of Indians out of poverty.

In line with the objective of “Broadband for All”, the Telecom Regulatory Authority of India (TRAI) has recommended setting up a ‘National Broadband Network' at a cost of about Rs.60,000 crore to achieve 16-crore broadband connections by 2014. Issuing its recommendations on ‘National Broadband Plan', TRAI said the project would be financed by universal service obligation (USO) fund and the loan given by the government. Therefore, there is an urgent need to facilitate rapid growth of broadband.

Phase I to cover all cities
Stating that a ‘National Optical Fibre Agency' (NOFA) will be set up to establish this broadband network, TRAI said the National Broadband Network will be an open access optical fibre network connecting all habitation with population of 500 and above. It will be established in two phases. The first phase covering all cities, urban areas and gram panchayats will be completed by 2012. Phase II will see the extension of the network to all the habitations having a population more than 500, to be completed by 2013. The optical fibre network would support following bandwidths of 10 Mbps download speed per household in 63 Metro and large cities (covered under JNURM) for every wireline connection by 2014; 4 Mbps download speed per household in 352 cities for every wireline connection by 2014; and 2 Mbps download speed per household in towns/villages for every wireline connection by 2014.

Besides NOFA, the regulator also recommended formation of State Optical Fiber Agency (SOFA) in every State with 51 per cent equity held by NOFA and the balance by the respective State governments. Both the government holding companies are expected to ring in revenue to the tune of Rs.26,000 crore a year.