Smart Cities gaining momentum in India

February 1st, 2017 by · Leave a Comment

This article was authored by Lachlan Colquhoun, and was originally posted on

Anyone wanting to understand which are the hottest telecoms markets in the world only needs to look to India, where we learned recently that foreign direct investment in the sector has more than tripled this year. 

Telecom Secretary J.S. Deepak told an event in New Delhi that FDI in the sector over the first eight months of the 2016-7 financial year was at $10 billion, against $2.9 billion last year and $1.3 billion the year before that.

Even in a market such as India, where we are used to big numbers, that is a significant increase.

There is no one single driver, but it is a combination of 4G – as evidenced by the spectacular arrival of Reliance Jio 4G –  the move to a cashless economy, the explosion of data use, investment in India based manufacturing, and also the advent of the government’s ambitious Smart Cities program.

This is a market, as the Deloitte Touche Tohmatsu report identifies, with one billion digital identities, one billion mobile and over 250 million bank accounts (in a relatively unbanked economy which has just de-monetized).

Little wonder that the consultancy is forecasting “a very big digital revolution in India which will create a trillion dollar plus opportunity.”

One of the more interesting drivers in India is the government’s Smart Cities program.

It’s easy to be cynical about big government initiatives such as this, and the urban renewal plan to create 100 smart cities is nothing but ambitious, but there are clear signs that this is an area that is going to see a lot of activity next year.

Recently, the government earmarked 83 smart city initiatives to be implemented in 20 cities in an initial phase next year.

This, the government says, will require an initial investment of $262 million, but the total investment ultimately required will be upwards of $5 billion, and much of it will come from the private sector in public-private partnerships.

Already, many telecoms and ICT companies are positioning themselves to be major players in the smart city space.

In November, Cisco announced its Internet of Thingsjoint venture with the Reliance Group, focused squarely on the development of IoT in the country.

Based on the Cisco Jaspers connectivity management platform, this plays into the Digital India project which is a cornerstone of Smart Cities.

Infrastructure major Larsen & Toubro has been selected for phase one of the smart city project in Nagpur, and will soon be busy laying 1200 kilometers of optical fiber, creating 136 Wi-Fi hotspots, setting up 100 digital kiosks and developing surveillance systems with almost 4000 IP-based cameras.

Other local companies positioning themselves include Indus Towers and Sterlite Technologies, which produces optical fiber cable in addition to its focus on BSS solutions for operators.

In August this year, Sterlite set up a Tech Academy to create a skilled talent pool of smart network professionals as it continues to focus on the smart city opportunity.

It is likely to be a good move. While the MNO sector risks paralysis due to overly intense competition – a point noted recently by Qualcomm’s Paul Jacobs – smart cities is, to mix metaphors, a greenfield market with lots of blue sky.

It is one we will be hearing a lot more about in 2017, I feel sure.

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