In one of the key moves of this year in the telecom infrastructure sector, the Department of Telecommunications (DoT) has issued right-of-way (RoW) rules for the roll-out of communication networks to facilitate the installation of mobile towers, optic fibre and copper cables in a time-bound and non-discretionary manner.
For several years, RoW has been the biggest hurdle in the expansion of telecom infrastructure across the country. Tedious application processes made obtaining RoW difficult for
telecom service providers while exorbitant administrative charges discouraged them from undertaking significant network roll-outs. Meanwhile, the absence of a standard administrative cost structure resulted in significantly high costs for obtaining RoW.
The new rules, the Indian Telegraph Right of Way Rules, 2016, effective November 15, 2016, are likely to resolve these issues and also help cable/tower companies and telecom operators realise the Digital India, Smart Cities Mission and BharatNet targets. They may also address the call drop issue and facilitate the transition to 4G networks.
Key features of the RoW guidelines
The key features of the Indian Telegraph Right of Way Rules, 2016 include:
- Designation of a nodal officer: All state governments are required to designate a nodal officer for the implementation of the rules.
- Electronic application process: The authorities concerned, that is, the central government, the state government, or local authorities, are required to start an electronic application process for telecom companies interested in setting up telecom towers or fibre infrastructure within one year of the implementation of the RoW rules. The state governments can also establish a single application process for all the appropriate authorities under their control.
- Laying telecom infrastructure: Telecom companies that intend to set up overground or underground telecom infrastructure need to submit their applications along with documents such as the licence granted by the central government, details of the underground infrastructure being laid by them, time and duration of work, etc. DoT has also imposed a one-time administrative fee of Rs 10,000 for the installation of a telecom tower and Rs 1,000 per km for optical fibre cable (OFC) networks.
- Permission of relevant authority: The concerned authority will need to examine the applications based on parameters defined under the rules such as mode of execution, duration of the project, estimated expenses, and responsibility for damage and public safety in the area being considered, and then take its decision within 60 days. Further, as per the new rules, no application can be rejected unless the applicant has been given a chance to explain its position. In case an application is rejected, the authority concerned would need to specify the reason for the same in writing. The rules also specify that no application must be rejected without giving the applicants reasons for the rejection and an opportunity to be heard. If the application is neither accepted nor rejected within 60 days, it would be deemed as approved and the same has to be communicated in writing to the applicant within five working days.
- Rules for installing telecom infrastructure: After receiving approval for developing infrastructure, the telecom companies need to make the payment or submit a bank guarantee within 30 days, and prior to the commencement of work. While setting up infrastructure, the telecom company needs to take measures to reduce public inconvenience and ensure public safety. In addition, the new rules mandate the provision of positional intelligence, that is, geographic information system (GIS), through appropriate technology on all underground telecom infrastructure to enable the appropriate authority to obtain real-time information.
- Appropriate authority to supervise the work: Under the new policy, the authority concerned has been granted the right to supervise the execution of the work and impose other reasonable conditions if required. If the authority finds the telecom company wilfully violating any conditions for the grant of permissions, it may forfeit, fully or partly, the bank guarantees submitted by the telecom company and withdraw the permission granted by giving the reasons in writing. However, in this case, the applicant must be given an opportunity of being heard.
- Right of appropriate authority to remove telecom infrastructure: When the appropriate authority considers it necessary to remove some telecom infrastructure, it will issue a notice to the telecom company. The telecom company is required to submit a detailed plan for removal or alteration of such telecom infrastructure to the appropriate authority within a period of 30 days of the notice. Meanwhile, the concerned authority will grant 90 days to the telecom company to remove or alter its telecom infrastructure. The responsibility and liability, including the cost for removal or alteration of such telecom infrastructure will be borne by the telecom company.
- Dispute resolution: According to the new policy, the central government will have to appoint officers to resolve disputes between telecom companies and the appropriate authority within 60 days of the implementation of the RoW rules. The officer designated by the central government will have to resolve disputes within a period not exceeding 60 days in a manner specified by the central government from time to time.
What does it mean for the industry?
India has been hugely deficient in terms of fibre availability on the ground with less than 20 per cent of its towers connected with fibre. In comparison, countries such as China and the US have almost 80 per cent of their towers connected with fibre though China has more number of towers than India. Moreover, even smaller countries of the BRICS (Brazil, Russia, India, China and South Africa) have higher fibre connectivity such as Brazil with almost 60 per cent and South Africa with 55 per cent of their towers connected with fibre.
The biggest hurdles to the roll-out of OFC and tower infrastructure over the past few years have been the variable and impractical procedures, and high levies imposed by different states and local bodies across the country. DoT’s latest guidelines, which are based on the Indian Telegraph Act, lay down clear rules that will greatly resolve these difficulties. Under these guidelines, DoT has fixed a 60-day limit for responding to an application and also capped the one-time administrative fee leviable at a reasonable level of Rs 1,000 per km of RoW or Rs 10,000 per tower application. In addition, a dispute resolution mechanism involving the central government has been specified to resolve disputes between the competent authority and the licensee.
Thus, these rules issued by the government will definitely help resolve the major issue of RoW, and enable operators and tower companies to lay the telecom infrastructure.
However, a word of caution needs to be added – these are RoW rules and not a policy per se. These rules have been well notified with clarity in the official gazette. What is now required is to monitor their implementation for a faster and smooth roll-out of overall telecom infrastructure. Besides driving GDP growth, this could contribute to the socio-economic growth of the country.