India may double spending on Internet grid to 700b rupees

New Delhi

INDIA is considering doubling spending to 700 billion rupees (S$14.6 billion) on a high-speed Internet grid to connect villages across the country, Communications Minister Ravi Shan-kar Prasad said.

A committee appointed by the ministry has recommended raising the allocation for the National Optical Fibre Network to enable changes to the project, Mr Prasad said. Prime Minister Narendra Modi will have to approve the budget increase.

"It is ambitious," Mr Prasad said. "We laid down one million kilometres of fibre in a time span of 30 years. Now, we propose to lay down 700,000 kilometres in three years."

An increase in the outlay will help Mr Prasad in the rollout of the broadband network that will link 250,000 village clusters to the Internet and is central to Mr Modi's US$18 billion Digital India initiative. The higher spending could potentially expand opportunities for companies - from local optical fibre suppliers such as Sterlite Technologies and Aksh Optifibre, to telecommunications gear vendors such as Cisco Systems and Huawei Technologies.

Previously, the government had budgeted 360 billion rupees for the broadband grid that is running behind its original schedule for completion by 2013. The 700 billion rupee plan includes money already spent on the project. BLOOMBERG