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The National Digital Communications Policy (NDCP) states that digital infrastructure and services are increasingly emerging as key enablers and critical determinants of a country’s growth and well-being.

Digital connectivity infrastructure (DCI) has a significant contribution to economic development by providing facilities to improve productivity and quality of life. Countries have adjusted their telecom licensing frameworks to increase resource utilization (including spectrum), reduce costs, attract investments, and improve infrastructure/network layers and services, in line with DCI development.

DCI has been successfully implemented under various government programs such as Digital India, Make in India, Ayushman Bharat Digital Mission (ABDM), and Smart City Development.

The initiative will help in promoting the adoption of 5G services in the real estate sector as well as enhancing the development of smart cities. Now DCI is becoming an integral part of the building development plan, similar to the ones followed for water, electricity, gas supply, and fire protection.

Along with building development, DCI would be co-created and designed through collaboration among various stakeholders, including developers and property managers (i.e., construction service providers), DCI professionals, and authorities at various urban and local bodies. DCI would be accessible to all service providers on a non-discriminatory, non-chargeable and transparent basis.

Real estate is among the most dynamic sectors worldwide, comprising four sub-sectors: residential, retail, hospitality, and commercial. Demand for office space, and urban and semi-urban accommodation, along with expansion in the corporate sphere, will drive growth in this sector.

Indian real estate market size, 2017-30

As per IBEF, the Indian real estate sector is expected to reach US$1tr by 2030 from US$200bn in 2021.

A Savills India report mentions demand for data centres will continue to grow by 15-18 million sq ft until 2025 due to the adoption of 5G, internet of things (IoT), artificial intelligence (AI), higher usage of cloud services, and the development of smart cities.

RERA

In February 2023, Telecom Regulatory Authority of India (TRAI) suggested the creation of provisions under the RERA act for mandating DCI in buildings as well as its maintenance and timely upgrade. This framework will be implemented within two years and is essential for smart cities, railways, metro stations, bus stations, malls, multi-speciality hospitals, airports, ports, residential, stadiums, museums, theatres, large commercial complexes, government buildings, industrial parks, etc.

One of the advantages of the DCI framework is to simplify the licensing process and ease the convergence of technologies while providing a more favourable environment for market growth and improving the socioeconomic well-being of masses.

Growth drivers

As per Internet and Mobile Association of India (IAMAI)’s report on Internet Adoption in India: ICUBE 2020, the number of active internet users in the country is forecast to grow ~45% to 900 million by 2025 from 622 million in 2020 (~ 700 million as of December 2022).

Nokia’s MBiT Index 2022 report indicated average monthly data consumption per user and 4G data traffic have increased 3x and 6.5x, respectively, while mobile broadband subscribers expanded 2.2x in the last five years, i.e., during 2017-21.

Introduction of smart devices, such as virtual assistants, smart light bulbs, automated gates, and smart refrigerators, has led to the shift towards a digitally connected environment. With higher reliance on digital connectivity, there is a continuous need for good and uninterrupted connection. 

Building rating framework

Once TRAI issues the regulatory framework, property managers will be required to obtain mandatory building ratings for digital connectivity within two years of receiving the occupancy certificate.

Building rating is dependent on factors such as DCI resilience, accessibility of connectivity throughout the building, availability of service providers, building future-readiness for digital connectivity, and quality of user experience. Thus, property managers need to make buildings conducive for digital connectivity.

Ratings will be listed on a searchable property directory, either as number of stars or any other visual representation. Buildings with good digital connectivity ratings will help tenants and residents take informed decisions and ensure no interferences prior to shifting into the premises.

Impact of DCI framework

  1. TRAI has released a consultation paper on the Introduction of Digital Connectivity Infrastructure (DCI) Provider Authorization under Unified License (UL). The aim of UL is one nation, one license across services and areas, i.e., telecom players can offer telecommunication services under one license which will help prevent the monopoly of a particular telecom service provider within real estate projects or apartments.
  2. DCI framework will help to create employment opportunities and transform youngsters into DCI professionals.
  3. To accelerate the 5G rollout across the country, delays in the installation of supporting infrastructure need to be reduced. Lack of set guidelines limits telecom service companies’ ability to improve networks. Thus, the framework will provide a clear path on the rights and duties of all stakeholders.
  4. Building rating framework will encourage property managers/builders to continuously improve digital connectivity for inhabitants. 

The DCI framework is required as the government’s reliance on digital infrastructure platforms is increasing over time. The move by TRAI to evaluate all buildings based on their digital infrastructure is a step in the right direction. It will allow people to have continuous access to uninterrupted high-speed internet connections, thereby easing remote work and other digital activities.

Ashwini Chakre, Senior Analyst