In 1994 the government issued its National Telecommunications Policy. The policy was issued in recognition of the "urgent need" to provide universal access to basic telecommunications services by 1997 and offers guidelines for entry of the private sector into basic telecommunications services. To facilitate pÍÍÍÍrivate-sector participation, licensing procedures were established in the Department of Telecommunications, and equity participation for companies registered in India (with 51 or more percent Indian ownership) was anticipated. Private-sector licenses, however, were to be granted only for local (versus long-distance) telecommunications networks. An autonomous body, the Telecommunications Authority of India, was established to regulate private-sector activity.

Telephone

The telephone system, like many other aspects of telecommunications, is in the government sector, under the control of the Ministry of Information and Broadcasting. The modernization of the telephone system has been underway since 1986 when Mahanagar Telephone Nigam, a government corporation, was established to operate systems in Bombay and New Delhi, and Videsh Sanchar Nigam, also government owned, was set up as the overseas carrier. Progress was slow, however the rest of the nation's service continued as a civil-service-run operation under the Department of Telecommunications until 1994 when basic telephone services were opened to private-sector competition.

The number of telephone connections rose from 800,000 in FY 1968 to 8 million in FY 1994. The system remains substandard by international standards, however, and there is a waiting list for connections of 2.8 million people. Sometimes several years elapse between application and installation of a telephone line. Close to 1 million new connections a year are being established in the mid-1990s. Plans for increasing the capacity of the system to handle more directly dialed calls were being implemented in the early 1990s, and 20 million lines should be in operation by FY 2000. This number is very low for a population that by then will probably exceed 1 billion. Telephone line density was less than 0.7 per 100 persons in 1994, one of the lowest densities among the major nations of Asia.

There also are submarine telecommunications cables linking India with Malaysia and the United Arab Emirates. Although the government is a major manufacturer of telephone equipment, the private sector--especially foreign ventures--is becoming increasingly involved in manufacturing in the mid-1990s and paging, cellular phone service, and electronic mail are being introduced.

Data as of September 1995