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Telecommunications in Nepal: Current State and Needs

With the innovation of modern telecommunications, Telecom has been an integral part of the development of countries, especially the Developed world since the beginning of 20th century, period when electrical and electromagnetic technologies evolved to serve long distances communications with the innovation of telegraph, telephone, teleprinter networks, radio, television, microwave transmission, fiber optics, and communications satellites. This was the crossing of the threshold from traditional means of communication to revolutionizing wireless communication.

Advancement from point-to-point communication to broadcast communication, and from analog to digital communications, Telecom technology has rendered to easy human communications needs exponentially. Telecom technologies are today an integral sector of the world, touching all sectors of the economy and every aspect of human life. Telecom is also changing the way we do business and run economies and exhibiting prospects for sustainable development. While the developed world is reaping fruits of the available and constantly evolving new technologies in Telecom, the developing countries are catching up and benefitting from it. This article endeavors to take a broad stock of the state of the Telecom sector in Nepal.

Current State of Telecommunications in the country:

Development of Telecommunication in Nepal still needs a big push while the increased use of Telecom in daily life and across sectors is a phenomenon. Read the history and milestones of telecommunication in Nepal. While Nepal’s Telecom sector has taken a fast pace of growth in the last few decades, and especially in the last decade with the increased penetration of mobile and internet across the country, it still lags far behind in terms of the global state of Telecom development. At home, its benefits have not reached many households, and where it has, has limited excess.

The available Telecom services are mostly centered on urban pockets of the country, leaving out the vast majority of the rural and geographically far-flung and remote areas, and to the population of a certain income bracket who can afford the services. The expansion of infrastructure, application of different Telecom services, their cross-sectoral and multi-dimensional application is severely limited to urban pockets and here itself it is at a relatively initial stage as compared to the global application of the new technologies.

Quality of Service (QoS) and access to available new technologies is still a major gap area. The technologies that are available and extensively being used in the global market have a meager presence in the country and have limited penetration in terms of benefitting from their exponential potentials. The existing infrastructure is inadequate to implement the new technologies in the country and benefit from them, signifying the overall poor state of our existing capacity to implement these new technologies in the country.

The telecom sector in Nepal is centralized. The policies and programs, which in themselves are by far inadequate and largely non-reflective of the potential expansion of Telecom encompassing across sectors, are constructed from a center, and centrally implemented.

It has not been able to grasp the diverse needs of the country (geographical diversity, remoteness, mass usage including those at the Bottom of the Pyramid), neither has the sector been a serious attraction for the government.

You might as well read: Challenges of telecom operators in Nepal

Notwithstanding the mere superficial acknowledgment of its potential and importance, the ignorance in policy-formulating circles of the fact that Telecom is a bridging factor for all sectors of development and infact can be a catalyzing tool for sustainable and inclusive development aspirations of the country remains a challenge. Investment in the Telecom sector is severely limited.

Telecommunications in Nepal has been for a long time a monopoly market. NTC was the only service provider for decades. While in the last two decades, a number of players have entered the market, it still is a playground for a few. Out of the five Telecom operators with licenses to operate telecom services in the
country, only two (NTC, NCELL) are active in the country and therefore have the market monopoly, while the other license holders (Smart, UTL) have very limited market share.

The poor market regulation of the service providers has hindered the capacity of the market to provide competitive quality service. Read more about  R&D in Nepal’s Telecom market is next to non-existent, and there is neither investment nor interest in this area.

Telecom as a catalyst for Nepal’s Development:

Telecom should not be viewed merely as an efficient mode of communication, rather more as an important aspect of development. An inclusive approach to this sector as a pivot to the country’s sustainable development is a progressive way of looking at the sector.

Telecom should be viewed as a key development stakeholder – the rich and exhaustive data that it generates is imperative for development practitioners in their work, the opportunities that it promises in accelerating sustainable development through its new technologies (virtual network, Mobi doctor, telemedicine, traffic control, e-commerce, m-commerce, etc), the role that it can play in the sustainable development of other sectors (industry, healthcare, agriculture, education, infrastructure) – all suggests towards immense development opportunities that Telecom can facilitate.

Looking Forward:

Telecom has been proving itself at the global stage as the catalyst for development, and a very promising agent for creating an environment for a sustainable economy. Nepal should consider this scope of the Telecom sector timely and gear towards integrating it into the mainstream development agenda without delay. In order to strengthen Telecom in the country, there is a need to revisit the existing legal frameworks, regulation and implementation dynamics, the service providers and the market dynamics (including the existing operator’s service delivery and quality and affordability of the available and perspective services).

Regional based policies and implementation strategies to address the diverse geographical needs, and institutions and implementation stakeholders, is a gap area that needs to be addressed. This ensures services are accessible to the mass, according to their particular needs (consumers at the bottom of the
Pyramid, Middle-Income consumers, geographical considerations). Regional and local based policies, programs and their implementation will benefit the diverse categories.

The policy outlook of the country acknowledging the key role of Telecom in development would be a cornerstone towards aligning all sectoral policy areas with the Telecom sector. In addition, there is a need to pump in financial investments into the sector in terms of expanding infrastructure and human resources in the sector should be implemented with priority.

Devising enabling market regulations would encourage more business interests and investments in the sector. While it is beneficial for the country in having a number of Operators competing and in result creating better and diverse services and cheaper prices for the consumers, it is also equally beneficial to have complementing resources enrichment and sharing.

The merger of the non-performing operators to give new life to licensed operators could be an answer there. Policies supporting both of the aforementioned threads will help. The recently launched Infrastructure Sharing Policy is a welcome move, while many areas of policy gaps are areas where enabling policies to need to be inducted.

Investment in R&D in Telecom and encouragement to new TeleTech Start-ups also need area. This mostly neglected field has the potential of creating ingenious technologies supporting the specific Telecom and development needs of the country.

Efforts should be initiated to bring Nepal’s Telecom at the global level. The global best practices in Telecom related policies and implementation, and enhancing of Nepal’s Telecom capability to cater Telecom services in Nepal at par with those available at the global level is where we should be aiming. And while putting this ambition forward, the reality of the fact that Telecommunications is strongly intertwined with other development areas for it to thrive (Energy for example), to aim towards Telecommunication led sustainable development naturally implies the holistic approach to its development.

Er. Somanta Raj Bhattarai
Telecom and IT Professional

The author is a Telecom Practioner and has been working in the Telecom Sector of Nepal for 10 years. He is a strong proponent for exploiting the Telecommunications for Nepal’s Sustainable Prosperity.

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