NEW DELHI : As Indian consumer continues to struggle with the quality of internet services and access across the country and an estimated 900 million are still without internet access the Government on Monday will launch the second and final phase of its flagship BharatNet project aimed at providing high speed broadband internet connectivity to all panchayats in rural India by March 2019.

The project aims to connect 1.5 lakh panchayats through 10 lakh Km of additional optical fibre and give bandwidth to telecom players at nearly 75 percent cheaper price for broadband and wi fi services in rural areas.

Interestingly, as India boasts of world’s top IT companies, tech entrepreneurs and digital startups, yet internet access to its people has been a dream. India is still home to nearly 900 million people who do not have access to the internet. In 2015, only 22% of adults in India had access to the Internet, according to the Pew Research Centre. Similarly, urban India with an estimated population of 444 million already has 269 million (60%) using the internet. Rural India, with an estimated population of 906 million as per 2011 census, has only 163 million (17%) internet users. It is precisely this chunk of the population that the Modi Government is planning to reach out to through its BharatNet scheme.

India was ranked 89th globally in connection speeds with an average speed of 6.5Mbps, marking an 87 per cent year-on-year change. In addition, a 4Mbps broadband adoption of 42 percent in the first quarter of 2017 with an 81 per cent year-on-year increase was also noted. The global average connection speed was 7.2Mbps this quarter, with peak connections across the world averaging at 44.6Mbps. This was stated in a report released by Akamai Technologies, the worldÂs largest cloud delivery platform recently.

The Government has sought the help of the leading telecom companies for this flagship programme and has made a provision of Rs. 3,600 crore subsidy for private telcos such as Bharti Airtel, Vodafone India, Idea Cellular and Reliance Jio through viability gap funding. This would be used for setting up Wi-Fi in rural areas as part of the second phase of the BharatNet project. 

The government is all set to complete the first phase of the BharatNet project by the end of 2017 Â which will give fibre connectivity to 1 lakh gram panchayats at an investment of Rs. 11,200 crore. “We expect telecom operators to provide at least 2 megabit per second speed to rural households,” Telecom Secretary Aruna Sundararajan stated.

The Union Communications Minister, Manoj Sinha, Law and IT Minister Ravi Shankar Prasad and Human Resource Development Minister, Prakash Javadekar launched the project today.

The Telecom Ministry will sign agreements with seven states — Maharashtra, Gujarat, Chhattisgarh, Andhra Pradesh, Telangana, Tamil Nadu and Jharkhand — which will roll out the project on their own with partial funding from the Central Government.

The total project cost of BharatNet is around Rs. 45,000 crore, of which Rs. 11,200 crore have been used for the first phase.

Ms. Sundrarajan said around Rs. 4.5 lakh crore value can be added to the national gross domestic product on completion of BharatNet phase 2 as a study has suggested that every 10 percent usage of Internet in India drives up GDP by 3.3 percent.

BSNL will roll out optical fibre in yet to be covered locations of eight states — Assam, Haryana, Madhya Pradesh, Rajasthan, Uttar Pradesh, West Bengal, Jammu and Kashmir and Sikkim that were not covered under the first phase of BharatNet. Power Grid Corporation of India Limited (PGCIL) has been awarded contract for three states — Himachal Pradesh, Uttarakhand and Odisha.

It is understood that the broadband services rates will be low because of intensive competition in the sector and the government is offering bandwidth under the project to telecom operators at 75 percent lower rate than they currently buy it. “India at present has 38,000 wifi hotspots. 

Under BharatNet phase 2, around 6-7 lakh wifi hotspots will be added with 2-5 hot spots in each panchayat. Some of the wifi hot spots may not be commercially viable initially. The viability gap funding of around Rs. 3,600 crore to telecom operators will be provided by the government,ÂÂ she added.