Budget 2025: Focus on Expanding Rural Internet Connectivity?

Budget 2025: Finance Minister Nirmala Sitharaman will present the Union Budget on 1 February 2025. The telecom sector is anticipating significant measures in this budget to boost internet access in rural India.

Budget 2025: Finance Minister Nirmala Sitharaman will present the Union Budget (Budget 2025) on 1 February 2025. This budget is expected to include significant measures to boost internet access in rural India. It could play a decisive role in bridging the digital divide and connecting the country's rural areas to the internet mainstream.

Current Status of Internet Usage in Rural India

By the start of 2025, India is projected to have over 900 million internet users, with a significant contribution from rural areas. Of the total 886 million users in 2024, 55% were from rural India. On average, an Indian individual spends 91 minutes online daily, while rural users spend approximately 89 minutes online. These figures indicate the rapid growth of digital service usage in rural areas.

Reasons for Internet Adoption in Rural Areas

Several key factors are driving the increase in internet usage in rural India:

1. Accessibility of Mobile Data: Mobile data prices have decreased by up to 90% since 2016, making it one of the world's most affordable markets.
2. Smartphone Usage: With 1.2 billion smartphone users in India, affordable devices have helped connect rural users to the internet.
3. Content in Local Languages: 57% of users in rural areas prefer content in local languages, increasing their likelihood of digital engagement.
4. Government Schemes: Programmes like BharatNet have worked to bring broadband connectivity to gram panchayats.

Previous Budgets and Government Initiatives

The 2024 budget allocated ₹1.28 lakh crore to the Ministry of Communications. This funding was used to improve telecom infrastructure and support schemes like BharatNet.

Tarun Pathak, Director, Counterpoint Research, said

According to Tarun Pathak, Director of Counterpoint Research, the first phase of the National Broadband Mission (NBM) did not fully achieve its goals. Therefore, Budget 2025 should include specific provisions for NBM 2.0. Furthermore, strengthening the Digital India Fund (DIF) initiative is crucial, as it will help increase connectivity in remote and rural areas.

Expectations from Budget 2025

The telecom industry expects the following measures from this budget (Budget 2025):

1. Tax Reforms: There is a demand to reduce import duties and other taxes on telecom service providers. This would increase infrastructure investment.
2. Investment in Digital Infrastructure: Allocation of funds is necessary to increase connectivity in rural areas.
3. Support for Local Manufacturing: Local smartphone manufacturing can be promoted through tax incentives.

Measures to Increase Internet Access

The government can increase internet access in rural India by taking the following steps:

Increase budget for digital infrastructure: Increasing funds for projects like BharatNet.
Public-private partnerships: Encouraging partnerships between government and private telecom companies.
Incentivizing local manufacturers: Providing subsidies to local manufacturers to reduce smartphone prices.
Digital literacy programmes: Educational initiatives to teach the rural population how to effectively use digital services.
Content in local languages: Promoting digital content in local languages.