Government Rejects TRAI Proposal To Subsidise Satellite Internet For Rural Users

A funding crunch and mandate mismatch stall plans for satellite internet subsidies, leaving rural users and providers to shoulder high terminal costs as India stays focused on core infrastructure.

The Indian government has declined a proposal from the Telecom Regulatory Authority of India (TRAI) to subsidise satellite internet services for rural and remote regions. Officials said the state has limited fiscal space and cannot support additional subsidy schemes at this stage.

The Digital Bharat Nidhi (DBN) fund, which was expected to finance the subsidies, already has commitments of nearly ₹1.73 trillion for existing programmes. These include BharatNet expansion, village-level 4G deployment and other digital infrastructure projects. As a result, only a small portion of the fund remains available for new initiatives.

Officials also noted that DBN is not designed for direct benefit transfers to users. Its framework supports area-based investments, such as capital expenditure for towers, fibre, and equipment, rather than individual device-level subsidies.

Extending DBN to cover satellite terminal support, they said, would fall outside its mandate and could duplicate existing efforts.

- Advertisement -

The government expressed concern that TRAI’s suggested approach, offering subsidies for satellite user terminals, could lead to inefficient targeting. They warned that it may also create overlap with broader connectivity schemes already funded through DBN.

With subsidies off the table, customers in remote areas may need to purchase satellite terminals themselves. These devices cost around ₹100,000 each. Alternatively, operators such as Starlink, Eutelsat OneWeb, Jio Satellite and Amazon’s Project Kuiper will have to absorb the cost if they want to grow their subscriber base in rural markets.

Instead of device-level subsidies, the government is prioritising the rollout of fibre networks, improved data centre connectivity and stronger cybersecurity measures as part of its digital infrastructure roadmap for 2025.

A revised spectrum usage fee of 5% of adjusted gross revenue will apply to satellite operators, higher than the 4% recommended by TRAI.

Telecom operators argue that subsidising satellite services through DBN would be unfair, as terrestrial players contribute the majority of funds. Industry groups, including the Broadband India Forum, continue to push for support for satellite technologies. However, the government remains firm on its infrastructure-first strategy.

- Advertisement -
Loading form…
Shubha Mitra
Shubha Mitra
Shubha Mitra is an Assistant Editor at EFY, keenly interested in policies and developments shaping the electronics business.

Industry's Buzz

HCLTech

HCLTech and Anthropic Partner to Accelerate Safe Enterprise Agentic AI

0
Global IT provider establishes dedicated Anthropic unit to build secure, governed Claude solutions for enterprise deployment.  HCLTech has announced a Global Premier Partnership with AI...

LTTS and Nvidia Launch AI-Native Manufacturing Lab in Bengaluru

0
The new facility leverages Nvidia accelerated computing to advance digital twins, industrial AI, and autonomous factory operations.  L&T Technology Services (LTTS) has inaugurated an AI-native...

TANAKA Targets Indian Semiconductor Expansion Without Local Plant

0
The Japanese supplier engages domestic firms following the Semicon 2.0 launch, but holds off on local manufacturing plans.  TANAKA Precious Metals India is looking to...

Defence Satcom Revenues to Exceed $22.6bn by 2035

0
Commercial satellite revenues in defence surge as armed forces shift to next-generation NGSO constellations.  Global demand for defence satellite communications is forecast to exceed 7.5...
Essencore

Essencore Partners With Syrma SGS, Brings KLEVV Products to India

0
Essencore and Syrma SGS Technology have partnered to expand electronics manufacturing in India and introduce KLEVV memory and storage products to the market, supporting...

Learn From Leaders

Does India’s Chip Packaging Growth Need Local Materials At Scale?

0
What will it take for specialised semiconductor materials manufacturing to grow in India? Packaging volumes will be a key factor as OSAT facilities move...
Ronak Kumar Samantray, Founder, TM2Space Technologies Pvt Ltd.

“Our goal is to build data centres in space.” – Ronak Kumar Samantray, TM2Space

0
A space startup aims to build orbital data centres, letting users run AI models and store data on satellites while also supplying satellite hardware...

India’s Photonics Puzzle Is Finally Coming Together 

0
Can India turn its scattered photonics capabilities into a stronger industry? A new association aims to connect the ecosystem and strengthen the domestic value...
Jin Bains, CEO, Mini-Circuits

Mini-Circuits CEO Jin Bains on Navigating High-Frequency Component SWaP-C Constraints, Emerging Markets, and Career...

0
In this exclusive, Jin Bains, Chief Executive Officer (CEO) of Mini-Circuits, explains in a conversation with Dilin Anand of EFY about areas of emerging...

India Needs Not a Hundred, But Thousands of Chip Diversified Companies 

0
Can India build a semiconductor ecosystem beyond fabs? Indiesemic believes thousands of diversified chip companies are needed to make that possible. India’s semiconductor push is...

Startups

Compcarta Reduces The Cost And Complexity Of End-To-End Chip Design

0
Building a chip should not require assembling an entire design ecosystem. A Noida-based startup is developing a browser-based EDA platform that aims to reduce...
PowerMon

Aquaexchange Brings Monitoring And Automation To Shrimp Farming

0
The startup has developed an AI- and IoT-enabled platform that helps shrimp farmers manage farms, access financing, monitor operations, and connect with markets. The startup...

Drone-Like Aircraft For Logistics From BluJ Aerospace

0
Hyderabad-based BluJ Aerospace is developing indigenous electric and hydrogen-powered vertical take-off and landing (VTOL) aircraft for remote cargo transport. BluJ Aerospace, a Hyderabad-based aerospace startup...
Jash Jetly, Co-founder and CEO of EVE

“The cloud isn’t the only way to run AI. We’re proving it can happen...

0
A startup is building a decentralised AI and communication network that runs across everyday devices instead of centralised cloud servers. In an interview, Jash...
Mohit Gupta, founder and CEO, TYLsemi

Building AI Chips, One Block at a Time 

0
What if building an AI chip became as simple as assembling reusable blocks? The startup is working to make custom silicon accessible beyond the...