INTERNET DIFFUSION IN INDIA

India’s lack of infrastructure and terrestrial telecom facilities has greatly hindered the progress of Internet diffusion. With the government taking the initiative and providing tax benefits and MNC coming in hordes to capture this investment opportunity the scenario is dramatically changing.

The Indian IT journey to greater heights was initially chartered by private industries and IT professionals who wanted to be amongst the best in the world. A bunch of upstarts a decade back unleashed a trail of achievements, which cascaded and has created the most compelling brand - the Indian IT professional. The market segments shaping the future of the industry are:

• IT software and services export
• IT enabled services
• The domestic IT market
• Telecom infrastructure
• Venture capital

NASSCOM, National Association of Software and Services Companies, the apex body and the Chamber of Commerce of India's software driven IT industry, recently conducted a survey on the growth of E-commerce in India.. The findings of the study have been summarized below :-

A survey indicates that India's Internet subscribers increased - from a meager 0.7 million subscribers in November 1998 to over 1.8 million subscribers by 31 December 2000. (2)

This significant boost to the country's Internet plans can be accounted to the Government, which has announced several landmark decisions that have helped increase Internet penetration in India. The Internet survey conducted in 68 cities / towns in India in  2002 (accounting for over 92 percent of the total Internet users in the country) on Internet Usage Trends by different agencies came up with some interesting findings:

• More than 200 cities and towns in India have Internet connectivity.
• As of Sep 2002, there was a PC base of 6.5 million PCs.  Out of these, there were more than 4.3 million machines that had Pentium II and above processors (i.e. machines which could be effectively used for Internet).
• More than 120 private ISPs would be fully operational by June 31, 2001 (out of the projected 500 licenses to be given by that date). (9)
• At least 12 private international gateways for Internet are expected in the same period. Seven private international gateways are already operational by December 2000.
• More than 86 percent of top 100 corporate companies (who responded to the survey) have endorsed the Internet and e-commerce as being an integral part of their corporate strategic framework for next year.
• The capital cities (New Delhi and other state capitals) today account for 79 percent of Internet connections across the country.  
• More than 81% of PC sales in financial year 2001 were driven by the need to access the Internet.
• 91% of India's corporate websites are located overseas.(6)
• There has been a substantial increase in Internet Access through all ages. More than 11% of all 40 year olds access the Internet now. The most widespread usage is found among the 18-24 year age group.(4)
• The male:female ratio of Internet Users has changed from 82% of males to 18% of females in June 1999, to 74% males to 26% females at the time of this study.
• Approximately 16,00,000 households are connected to the Internet
• Of all Internet Users, the corporate/professional segment forms the largest at 43% followed by students at 38%
• More than half (59.2%) of the Internet user population use it for information seeking purposes, 11.3% use it for education purposes and 8.2% use it for entertainment. (2)

According to Boston Consulting Group’s recent report, `Digital Dragons,’ India’s number of internet subscribers will grow at the compounded annual growth rate of 42 per cent in the 1999-2004 periods. According to analyst estimates, India will have 35 million internet subscribers by 2004-end. 

    Top

   home