Telecom regulator TRAI today came out with a consultation paper to find ways and methods to increase broadband penetration in the country.

"It is a matter of concern that broadband penetration in India is low at just 0.74 per cent in spite of 104 telecom service providers providing broadband services. The teledensity is 52.74 per cent," TRAI said in the consultation paper.

A need is being felt to identify impediments and create an environment to encourage broadband growth, TRAI said. The net broadband additions per month are just 0.1 to 0.2 million in contrast to approximately 18 million mobile connections per month, said the paper.

Availability of broadband services at an affordable tariff will provide people access to information, facilitate delivery of civic services, increase GDP contribution, generate employment and enhance productivity, the telecom regulator said in its paper.

Broadband Internet is typically defined as a technology offering speeds ranging from 64 kilobytes per second (kbps) to 2 megabytes per second.

The move comes at a time when the auction for Broadband Wireless Access (BWA) spectrum is going on. BWA spectrum allows companies to offer high-speed Internet access as well as Internet telephony and TV services.

The paper suggested that optical fibre should be laid to connect 3.75 lakh villages having a population of 500 or more.

"Such a network would require laying of about 12 billion kilometres of optical fibre at a cost of about Rs 323 billion," it said.

The project could be funded by the Mahatma Gandhi National Rural Employment Guarantee Scheme for non-skilled work and from the Universal Services Obligation Fund for material and equipment, it added.

The optical fibre network would help various service providers and users get broadband through a variety of wired and wireless solutions. Till now, the broadband facility has been limited to metros and major cities.

There were nine million broadband subscribers at the end of April, 2010, of which a mere five per cent were in rural areas. The government had set a target of 20 million broadband subscribers by 2010 as part of the Broadband Policy 2004.

"The situation demands an urgent focus on creation of robust national infrastructure scalable to cater to future requirements not only in urban areas, but also up to villages," it said.

TRAI has asked industry players and stakeholders to send their comments on the consultation paper by July 7, 2010.