Railtel Corpn. Management Discussions


1. Economy Overview

Introduction

The world is more connected than ever before and impact of events in one corner of the globe is seen more pronounced in the other corner. Variables such as uncertainties and geo-political segmentations are looming large over most of the leading economies.

Indian economy, has emerged as a bright star in its 75th year of independence when it grew at 7.2% in 2022-23, becoming fastest growing major economy in the world for third time in a row.

While the World Bank is worried as the ongoing slump in the global economic growth may swamp the third decade of this millennium, most of the global market analysts are forecasting this decade to be of Indias decade. The capital expenditure focused on infrastructure development driven by both the Government of India and State

Governments continue to be a key growth driver. The rural economy, service sector, construction and real estate are continuously improving their performance. Robust direct tax collection (up by

20.1%) and GST collection (up by 22%) are other indicators of Indian economy marching towards global leadership role.

Indias commencement of its G-20 presidency on 1st December 2022 marks a significant step towards undertaking a leadership role on the global stage as the global economy sails through the storm of a unique set of economic challenges. With the theme of Indias G20 presidency "Vasudhaiva Kutumbakam" or "One Earth, One Family, One Future", India has identified several points which shall be prioritized for its G20 presidency. These include inclusive, equitable, and sustainable growth; LiFE (lifestyle for the environment); womens empowerment; digital public infrastructure, tech-enabled development in health, agriculture, education, commerce, skill-mapping, and culture and tourism; climate financing; circular economy; global food security; energy security; green hydrogen; disaster risk reduction and resilience; developmental cooperation; fight against economic crimes and multilateral reforms.

1.1 Market size

Indias gross domestic product (GDP) at Current Prices in the year 2022-23 is estimated to attain a level of 272.04 lakh crore, as against 234.71 lakh crore in 2021-22, showing a growth rate of 15.9 percent.

India to witness GDP growth of 6.0 per cent to 6.8 per cent in 2023-24, depending on the trajectory of economic and political developments globally.

• Economy is expected to grow at 7 per cent (in real terms) for the year ending march 2023, this follows an 8.7 per cent growth in the previous financial year.

Credit growth to the Micro, Small and Medium Enterprises (MSME) sector has been remarkably high, over 30.5 per cent, on average during Jan-Nov 2022.

• Capital expenditure (capex) of the Central government, which increased by 63.4 per cent in the first eight months of FY23, was another growth driver of the Indian economy in the current year.

RBI projects headline inflation at 6.8 percent in FY23, which is outside its target range.

Private consumption as a percentage of GDP stood at 58.4 percent in Q2 of FY23, the highest among the second quarters of all the years since 2013-14, supported by a rebound in contact-intensive services such as trade, hotel and transport.

• Key Sectors Attracting the Highest FDI Equity Inflow: Services Sector (16%), Computer Software & Hardware (15%), Telecommunications (6%), Trading (6%), Automobile (6%), Construction Activities (5%), Construction Development (4%), Chemicals (3%), Drugs and Pharmaceuticals (3%), and Metallurgical Industries (3%) from April 2000-June 2022.

(Source: www.mospi.gov.in & www.pib.gov.in)

1.2 Recent Developments

With an improvement in the economic scenario, there have been investments across various sectors of the economy. In March 2023, Private equity (PE) and venture capital (VC) investments stood at US$ 5.3 billion across 82 deals, including 14 large deals (deals of value greater than US$ 100 million) worth US$ 4.3 billion.

According to the Department of Economic Affairs, Indias outward foreign direct investment (OFDI) stood at US$ 2.22 billion in March 2023 vs. US$ 2.71 billion in February 2023. The gross GST (Goods and Services Tax) revenue collection stood at Rs. 160,122 crore (US$ 19.6 billion) in March 2023.

1.3 Government Initiatives for economy

Some of the initiatives and developments undertaken by the Government are listed below:

• Seven priorities of the budget ‘Saptarishi, are inclusive development, reaching the last mile, infrastructure and investment, unleashing the potential, green growth, youth power, and the financial sector.

• Capital outlay of Rs. 2.40 lakh crore (US$ 29.2 billion) has been provided for the Railways, which is the highest ever outlay and about nine times the outlay made in 2013-14.

• Urban Infrastructure Development Fund (UIDF) will be established through the use of priority sector lending shortfall and shall be managed by the National Housing Bank and will be used by public agencies to create urban infrastructure in Tier 2 and Tier 3 cities.

• Revamped credit guarantee scheme for MSMEs to take effect from 1st April 2023 through the infusion of Rs. 9,000 crore (US$ 1.09 billion) in the corpus. This scheme would enable additional collateral-free guaranteed credit of Rs. 2 lakh crore (US$ 24.4 billion) and also reduce the cost of the credit by about 1%.

• 500 new ‘waste to wealth plants shall be established under the scheme for promoting a circular economy at a total investment of

Rs. 10,000 crore (US$ 1.21 billion). Centre to facilitate one crore farmers to adopt natural farming over the next three years. For this, 10,000 Bio-Input Resource Centres are to be set-up, creating a national-level distributed micro-fertilizer and pesticide manufacturing network.

• Three centres of excellence for Artificial

Intelligence to be set up in top educational institutions to realise the vision of "Make AI in India and Make AI work for India".

• National Data Governance Policy to be brought out to unleash innovation and research by startups and academia.

(Source: www.ibef.org & Union Budget 2023-24 document)

1.4 Road Ahead

The Indian economy is expected to grow in a range of 6.5-6.7 per cent in the financial year 2023-24

Growth will be supported by strong domestic drivers and robust momentum in capital expenditure. The government expects Indias 2023-24 GDP at 6.5 per cent. The Indian economy remains resilient in the face of challenging global environment and no major domestic road blocks am expected in the year ahead. Apart from the capex push by the government, the resilience in the domestic economy come from the healthy balance sheets of the corporates and a well-capitalized financial system

Growth in goods exports is forecast to be moderate in FY2023 before improving in 2024, as production-linked incentive schemes and efforts to improve the business environment, such as streamlined labor regulations, improved performance in electronics and other areas of manufacturing growth. Services exports growth has been robust and is expected to continue to strengthen Indias overall balance of payments position. Range of pragmatic and transformational policies of the government, which continued through pandemic, helped catalise a sharp recovery and the resilience in growth that

India is currently witnessing. Livelihood, tourism, wellness, skill development and future technologies were outlined as some Clls key action priorities for the coming year. Despite strong global headwinds and tighter domestic monetary policy, various international agencies have forecasted India to be one of the fastest growing economies in

2023-24, supported by robust growth in a private consumption and sustained pick-up in private investment. (source: www.timesofindia.com )

2. Telecom Industry

2.1 Telecom Industry Characteristics

The Indian telecom services industry can be broadly segregated into wireless, wireline and enterprise services. Wireline services are traditional landline calling services and wired broadband service.

Wireless service includes mobile calling, SMS (short message service), wireless broadband, triple play service, and over-the-top (OTT) platforms.

Structure of the Indian telecom industry

Enterprise services provide network connectivity across locations and users in an organization as elaborated below:

2.1.1 Wireline services

A wireline service is connection to the end customer by means of a cable through which a user can make phone calls or connect to the internet.

2.1.2 Wireless services

Calling: Mobile phone network by which end-users are connected to the network via wireless transmission technologies.

SMS: This is a text messaging service component of most telephone, internet and mobile device systems. It uses standardised communication protocols to enable mobile devices to exchange short text messages. An intermediary service can facilitate a text-to-voice conversion to be sent to landlines.

Broadband: WAP (Wireless Application Protocol) and GPRS (General Packet Radio Service) are used to deliver rich content, such as songs, videos and games, to a subscriber. Web browsing, and receiving and sending of e-mails and instant messaging are other activities that a subscriber can perform via a GPRS subscription.

2.1.3 Video conferencing: This is a visual communication session between two or more users regardless of their location, featuring audio and video content transmission in real time. It is a high-tech communication tool for increasing business efficiency, optimising and accelerating decision making processes, and cutting travel costs. 2.1.4 Triple play: In telecommunications, triple play service is a term for the provisioning, over a single broadband connection, of two bandwidth-intensive services, broadband Internet access and television, and the latency-sensitive telephone. Triple play focuses on a supplier convergence rather than solving technical issues or a common standard.

2.1.5 OTT: Over-the-top (OTT) refers to the method of sending content over a high-speed Internet connection, instead of the content being shared by traditional distributors such as broadcasters, cable and IPTV operators. OTT content is, in most cases, film or TV content which is watched on a phone, laptop, tablet or connected TV. Examples of these services are social media apps (WhatsApp, Instagram, etc) and content streaming services (RailWires Tarang/Umang OTT bundled broadband plans including, Zee5, SonyLiv, Discovery+, Hungama, ALT Balaji etc). To adapt to the growing acceptance of OTT services, communication service providers are resorting to bundling of OTT and data subscription packs.

2.1.6 Enterprise services

Dedicated leased fiber:Typically, dedicated fiber-leased lines fulfil two purposes: (i) corporate offices with high-capacity connection to the internet and (ii) connect the local network of several corporate offices to form a Wide Network. In this case, individual subscribers could be organisations using fiber for business purposes. Having access to a leased fiber line has many benefits, such as faster connection speeds, connection reliability, stronger signal, low latency, symmetrical speed (in terms of equal download and upload speeds). RailTel

Corporation of India Ltd, Reliance Jio Infocomm Ltd, Bharti Airtel Ltd, Bharat Sanchar Nigam Ltd (BSNL), Tata Communications Ltd and Vodafone Idea Ltd are major players providing these services.

Tower co-location: This is a service provided by Infrastructure Provider (IP) companies.

Co-location involves mounting of nodes on existing tower infrastructure to receive and transmit data and voice packets wirelessly. IP companies receive rent from wireless telecom companies that do not have funds or do not want to undertake significant capex to set up their own BTS network. RailTel Corporation of India Ltd, Bharti Infratel Ltd, Bharti Airtel Ltd, GTL Infrastructure Ltd, Indus Towers Ltd, Reliance Jio Infocomm Ltd, and Vodafone Idea Ltd are the main players providing tower co-location services. Tower co-location has become an important source of revenue for these companies with the rise in spectrum allocation, enhancing the need for more BTS units to be installed.

VPN: A virtual private network (VPN) uses public telecommunication infrastructure, such as the internet, to securely connect remote sites/users to the organisations network. These services cost less than alternatives, such as traditional leased lines or remote access servers. RailTel

Corporation of India Limited, Tata teleservices, Sify technologies, Reliance Jio Infocomm are major services providers.

MPLS-VPN: To provide traffic isolation differentiation without substantial overheads, Multi-Protocol Label Switching (MPLS) is among the commonly used methods to create

VPNs. MPLS involves setting up a specific path for a given sequence of data packets, each identified by a label, which reduces the time for a router to look up the address of the node where the data packet is forwarded to. Besides speeding up internet traffic, MPLS makes easy for a service provider to monitor the quality of service (QoS). MPLS-VPN technology allows service providers complete control over parameters that are critical to offering customers service guarantees with regard to bandwidth throughputs, latencies, and availability. It reduces network complexity and cost for the customer, and eliminates the need for an in-house technical workforce. RailTel, Tata teleservices, Sify technologies, Reliance Jio are major services providers.

VSAT: Very Small Aperture Terminal (VSAT) refers to a small fixed earth station, which provides a vital communication link required to set up a satellite-based communication network. It refers to receiving/ transmit terminals installed at dispersed sites connecting to a central hub via satellite using small diameter antenna dishes

(0.6-3.8 metres). Bharti Airtel limited, Hughes Escorts communications ltd., ITI ltd., Tatanet services limited, are few service providers in the segment.

NLD: National Long Distance (NLD) service refers to carriage of switched-bearer telecommunication services over a long distance network, i.e., a network connecting different short distance charging areas, or SDCAs. Such a service provider is usually a telecom operator providing the required digital capacity to carry long distance telecommunication services within the scope of their licence, which may include various tele-services, such as voice, data, fax, text, video and multimedia, etc. Major players in the NLD space are BSNL, Bharti Airtel, Mahanagar Telephone Nigam Ltd, Power Grid Corporation of India Ltd, RailTel, Reliance Jio Infocomm, Tata Communications and

Vodafone Idea.

ILD: International Long Distance (ILD) service is defined as a network carriage service, providing NLD operators in the country international connectivity, by connecting to network facilities operated by foreign carriers in other countries.

It involves setting up of undersea fiber cables to transmit voice and data globally. It provides most services an NLD licensee would provide, but internationally.

Major players operating with ILD licence are AT&T Global Network Services India, Bharti Airtel, BSNL, Reliance Jio Infocomm, Sprint Telecom India, Tata Communications, Verizon

Communications India and Vodafone Idea.

DLC: Domestic Leased Circuits (DLC) refers to a leased circuit that is connected to a subscribers premises within India. The telecom service providers provide DLCs to connect two or more customer sites or customers to their own or other service providers network. Currently, Reliance Jio Infocomm , Bharti Airtel, BSNL, RailTel, Tata Communications, and

Vodafone Idea are the major players operating in the DLC business.

IPLC: International Private Leased Circuit (IPLC) is a point-to-point private line used by an organisation to communicate between geographically dispersed offices that dedicated international connectivity with a committed bandwidth. An IPLC can be used for internet access, business data exchange, video conferencing, and any other form of digital transmission. Currently Bharti Airtel, BSNL, Reliance Jio Infocomm, Tata Communications and Vodafone India are major players providing international leased line services in India.

Data Centre: A Data Centre houses and maintains back-end information technology (IT) systems and data stores mainframes, servers and databases. Data centres also provide support to companies by offering extensive IT infrastructure, including servers, firewalls, storage systems and various other IT components, in a different place. Data centre services can be further classified into two types: the captive model and the co-location model. Bharti Airtel, Reliance Data Centre, Sify Technologies, STT Global Data Centre, Vodafone Idea, Amazon and RailTel Corporation of India are some of the players providing data centre services in India.

2.2 Recent trends in Telecom and Telecom Data services industry in India

India is the worlds second-largest telecommunications market. The total subscriber base, wireless subscriptions as well as wired broadband subscriptions have grown consistently. Tele-density stood at 84.56%, as of December 2022, total broadband subscriptions grew to 832.2 million until

December 2022 and the total subscriber base stood at 1170.38 million in December 2022.

The total wireless data usage in India grew at a rate of 6.65% from 37,626 PB in September 2021 to 40,126 PB in September 2022. The contribution of 2G, 3G and 4G data usage to the total volume of wireless data usage was at 0.16%, 1.02% and 98.81%.

The total number of internet subscribers reached 850.95 million in June- September 2022. The wireless segment accounted for 95.4% of the total telephone subscriptions In June 2022. Over the next five years, rise in mobile-phone penetration and decline in data costs will add 500 million new internet users in India, creating opportunities for new businesses.

By 2025, India will need ~22 million skilled workers in 5G-centric technologies such as Internet of Things (IoT), Artificial Intelligence (AI), robotics and cloud computing.

Below are the elemental strategic trends that are essential for telecoms in the digital age and will be critical in shaping the future of the telecom industry:

Adoption of Cloud Technology: The increased use of IoT devices and Machine Learning Algorithms in the telecom digital ecosystem has led to bulging demand for computing power. Given that cloud computing environment allows more capacity, improves resiliency, enables them to scale effectively to meet the rising demands, and easily updates systems.

Accelerated Technological Progress: Even as the digitization is a must-have strategy for companies in this tech era, the journey itself is laden with a torrent of challenges. This is why Telcos continue to leverage the inherent technological strengths across their distribution network to reimagine their customer journey from a data-driven perspective. Telcos today are forging ahead in their digital transformation journey, with most of them incorporating technological developments like 5G, Internet of Things (IoT), and Cloud technology, in their business and operational strategy. The ever-increasing data traffic and the evolving needs of customers necessitates increasingly powerful and secure network systems.

Deepening customer engagement and enhanced customer experience: Within the telecom sector, the ecosystem extends far beyond the traditional scope of activities and encompasses not just the basic services of the company but also the non-core and complementary products and services. With the wide range of options available in the market, it becomes critical for telecom operators to create tangible value and a key differentiator in their service offerings to retain loyalty. The first step the process of enhancing customer experience is to understand their pain points. Customers now expect uninterrupted connectivity, a wide range of customized offerings, and quick resolution of their issues.

Driving down OPEX: With growing competition in the market, the revenue margin for standard telecom services has decreased significantly. Due to this, driving down OPEX in the supply chain has been a primary focus for telecom companies across the industry to maintain a competitive edge.

The biggest potential is based on modernizing the existing operational solutions and embracing automation in sales and distribution.

2.3 Key opportunities and Threats in the telecom services industry

India has made significant progress in telecommunications with the rollout of 5G networks. It is looking to participate in developing global 6G standards by forming the 6G Technology Innovation Group (TIG). The future growth of the telecom industry in India is expected to be driven by advances in 5G and 6G which have the potential to improve communication and connectivity, increase efficiency and drive economic growth However, challenges such as expanding optical fiber coverage and improving cyber security policies must be addressed. With the right approach, Indian distinctive infrastructure industry has the potential to establish strong recognition in the global market and play a key role in realizing the vision of Digital

India. theThe telecom services and its allied business nurture upon opportunities such as low rural tele-density, infrastructure required for 5G launch, low cost-mobile handsets, growing demand for internet amidst emerging culture of work-from-home and relaxation on FDI inflows to encourage investments in the sector.

2.3.1 Opportunities a) 5G is the next technology frontier in the telecom sector

According to the High-Level Forum of the in Department on 5G, 5G is predicted to create a cumulative economic impact of USD one trillion in India by 2035. 5G will be used in INDIA to enable DIGITAL India, SMART Cities & SMART Village missions for India. LMLC (Low Mobility Large Cell) is in the final approval stages. 5G must be adopted in small pockets and adoption to grow gradually.

b) Internet of Things (IoT)

The Indian Government is planning to develop

100 smart city projects where IoT will play a vital role in the development of those cities.

In addition, there is accelerated adoption of IoT in industries especially manufacturing, automobiles, airports, supply chain. Other areas where adoption is witnessing growth are - Smart Home, Smart Heath, Smart Water, Smart Education, Smart Agriculture, Smart Grid, Intelligent Transport, Wearables, Smart Energy, Industry Automation, Connected Cars.

c) High bandwidth broadband:

India aims to accelerate deployment of next-generation ubiquitous ultra-high broadband infrastructure with 100% coverage of 10 Gbps across urban India and 1 Gbps across Rural

India as part of 5G mission. BWA technologies such as WiMAX and LTE are among the most recent and significant developments in wireless communication. Bharti Airtel VoLTE and Reliance

Jio 4G services are live across all the 22 telecom circles since 2019.

d) Low latency industry apps and Cloud computing:

The mobile value-added services have become a new revenue stream for the companies in recent years due to the low-cost ownership nature and low expenses of building systems on cloud platforms. That is, Cloud VAS has become a mainstream business for a wide range of companies to target their customers and improve their revenue.

As digital services for various vertical markets expand with applications where latency becomes critical for cloud computing services, it is only logical to also bring compute closer to where the data is generated. Hence India is seeing a surge in interest for Edge Computing like the rest of the world. Indias leading ‘Edge use cases are likely to be media processing, telemedicine, video surveillance, manufacturing and a myriad of immersive applications such as AR/VR and gaming.

e) Cyber Security

Recipients of services provided by telecom operators are becoming extremely vigilant on overall security measures adopted in providing services, also known as establishing "Digital

Trust" and the customers are moving to providers who are able to position themselves in establishing robust digital Trust. Some key opportunities in this space are cyber security to enterprises, specifically on back of other enterprise services offered, Positioning new products and services being offered with security and data privacy embedded, providing subscriber basic security services on an ongoing basis across the smart devices being used to consume services. f) Fiberization, IPfication and improved

Backhaul

To realize the full potential of the upcoming technologies, the significance of effective mile connectivity cannot be underplayed for which fiber, IPfication, and backhaul need improve. For Fiberization, the area of utmost significance is GIS mapping which need to be done to avoid duplication of fiber.

2.3.2 Threats

The telecommunications industry is undergoing significant transformations with plentiful opportunities but also new risks. An increased presence of new assets, both digital and physical, enlarges the required perimeter that your cybersecurity team needs to defend.

a) Network Security:

Network security is a set of technologies that protects the usability and integrity of a companys infrastructure by preventing the entry or proliferation within a network of a wide variety of potential threats.

b) Security threats in the Internet of Things:

One of the biggest challenges for telecommunications and ISPs is the security of

IoT networks. This year, approximately 25 billion devices are expected to be connected to the internet. Unfortunately, such large networks are attractive targets for data breaches and identity theft. Players in the telecom industry need to use online data protection tools such as VPNs, SIM-based authentication mechanisms, and identity management solutions. VPN establishes a secure connection to the internet by routing it through a virtual tunnel where data traffic encrypted. c) Cloud security threats

Some of the most common cloud security threats are misconfiguration, data breaches, insider threats, lack of cloud security architecture and strategy, insufficient key management, weak control planes.

It is crucial to monitor employee cloud usage and implement safeguards to prevent cloud data loss. In addition, managing mobile devices and defining permissions for enterprise and user owned endpoints including workstations, laptops, and smartphones can effectively minimize risks. d) Threats targeting subscribers

These threats include phishing, data breaches, and malware attacks. Among these, one of the most damaging and most widespread are phishing attacks. They account for 90% of all breaches small businesses face, growing 65% in the last year with over $12 billion in losses.

What makes phishing attacks so damaging is that theyre always adapting, making it hard to train employees on consistent detection.

However, having solid identity authentication in place can prevent phishing from victimizing your subscribers or users.

3. IT/ICT Industry

ICT refers to a range of technological applications used to transmit and process information.

Information, communication, and technology are combined to produce the term ICT. The market is segmented based on the type (hardware, software, IT services, and telecommunication services), the size of enterprises (MSMEs and large enterprises), the industry vertical (BFSI, IT and telecom, government, retail and E-commerce, manufacturing, energy and utilities, and other industry verticals) across India. The Indian ICT market is anticipated to record a CAGR of 9.47% over the period of 2023-28. The Indian ICT market has been evolving with the countrys digitalization, where skilled IT employees isand low employment costs have attracted multiple

IT companies to establish their base. Furthermore, favourable government policies have helped multiple small and large enterprises to turn digital, thereby increasing demand for ICT hardware, software, and services in India.

• India is considered one of Asias largest and fastest-growing markets for digital consumers, yet adoption among businesses is mixed. As digital capabilities increase and connectivity becomes ubiquitous, digital technology is poised to rapidly drive every sector of the Indian economy. Building a digital infrastructure is a fundamental approach for countries to advance their digital value chains.

• The Government of India is driven to establish favorable policy and regulatory environments for the ongoing expansion of 5G, Internet of Things (IoT), Artificial Intelligence (AI), Cloud Technology, Blockchain and Machine-to-Machine (M2M), and many more sectors as a result of the ICT sectors rapid growth in India and its substantial contribution to the socioeconomic development of the nation. For ICT to become one of Indias main economic growth engines, the government must prescribe the proper policy measures. The developments in the technological aspects will drive the market in the region.

• India uses information and communication technologies to provide its citizens with faster and more transparent services through e-government initiatives. Many individuals in the country cannot access these services due to a lack of skills, training, and infrastructure.

• The Micro, Small, and Medium enterprises (MSMEs) industry significantly contributes to the nations socioeconomic growth. Due to the sectors contribution to the GDP and exports of India, it has taken on a substantial amount of significance. The industry has also significantly contributed to the growth of entrepreneurship, particularly in Indias semi-urban and rural areas.

• The government encouraged the MSMEs to market their products on the e-commerce site and through the Government e-Marketplace (GeM), which is run and owned by the government. Many Ministries and PSUs (public sector undertakings) source their procurement from GeM. As a result of such rigorously supportive initiatives, many Indian MSMEs and

SMEs are partnering with foreign companies to extend their services for further growth, leveraging new technologies and services.

4. Government Initiatives for Telecom Industry

The government in the Union Budget 2023 has allocated Rs. 97,579 crores for the Department of Telecommunications, an increase of 19% over the revised estimates of 2022-23. The allocation is 2.2% of the total budget of central government and Rs 258.14 billion for postal projects.

According to budget documents, the government has raised the non-tax revenue collection estimate from the telecom sector by 30 per cent to Rs 894.69 billion in 2023-24. The government has revised the revenue estimate to Rs 687.84 billion for the current fiscal from an earlier projection of Rs 528.06 billion in the previous budget.

Some of the major initiatives taken by the government are as follows:

• The government will set up 100 labs to develop applications using the newly-launched 5G services. The labs will cover, among other things, applications such as smart classrooms, precision farming, intelligent transport systems, and healthcare.

• The government has allocated Rs 21.58 billion for optical fibre cable-based network defence services and Rs 7.16 billion for telecom projects in the north-eastern states.

• Mobile phone production in India has increased from 58 million units valued at about Rs 189 billion in 2014-15, to 310 million units valued at over Rs 2.75 trillion in the FY 2022-23. To further deepen domestic value addition in the manufacture of mobile phones, the government has proposed to provide relief in customs duty on import of certain parts and inputs such as camera lens and continue the concessional duty on lithium-ion cells for batteries for another year. According to the budget document, the

2.5 per cent basic customs duty on camera lens and its inputs/parts for use in manufacture of mobile phone cameras has been done away with.

• Three centres of excellence for artificial intelligence (AI) will be set up to realise the vision of ‘make AI in India and make AI work for India. This will be set up in top leading educational institutions. Leading industry players will partner in conducting interdisciplinary research, develop cutting-edge application and scalable problem solutions in the areas of agriculture, health and sustainable cities.

(Source:https://tele.net.in/budget-2023-key-highlights-for-the-telecom-sector-and-industry-comment)

5. TRAI Regulations

Telecom Regulatory Authority of India was established on 20 February 1997 by an Act of Parliament to regulate telecom services and tariffs in India. Earlier regulation of telecom services and tariffs was overseen by the Central Government.

TRAIs mission is to create and nurture conditions for the growth of telecommunications in India to enable the country to have a leading role in the emerging global information society. One of its main objectives is to provide a fair and transparent environment that promotes a level playing field and facilitates fair competition in the market. TRAI regularly issues orders and directions on various subjects such as tariffs, interconnections, quality of service, Direct To Home (DTH) services and mobile number portability.

During 2022-23, various recommendations were made to the Government by TRAI during the year.

40% carbon reduction in telecom networks by 2022-23 with base year being 2011-12.

• Issues related to Community Radio Stations

Regulatory Framework for Promoting Data Economy Through Establishment of Data Centres, Content Delivery Networks, and Interconnect Exchanges in India

During 2022-23, TRAI initiated various consultations on the following in telecommunication sector: Introduction of Digital Connectivity Infrastructure Provider (DCIP) Authorization under Unified License.

• Regulating converged digital technologies and services enabling convergence of carriage of broadcasting and Telecommunication services

Telecom Infrastructure sharing, Spectrum sharing and spectrum leasing

License Fee and Policy matters of DTH services

Licensing framework and regulatory mechanism for submarine cable landing in India

Data communication services between aircraft and ground stations provided by organizations other than Airports Authority in India

• Calling Name Presentation (CNAP) in

Telecommunication networks

Draft Telecommunication (Broadcasting And

Cable) Services Interconnection (Addressable Systems)

Leveraging Artificial Intelligence and Big Data in Telecommunication Sector

• Embedded SIM for M2M Communications (Source: www.trai.gov.in)

6. RailTel – An Overview

RailTel Corporation of India Ltd is a "Mini Ratna (Category-I)" CPSE formed in the year 2000 as a ‘Schedule A CPSE, under the Ministry of Railways, in line with NTP ‘99. RailTel has seamless Right of Way (ROW) along 67,956 KM of Railway Track passing through 7325 stations across the country. We are one of the largest neutral telecom infrastructure providers in the country owning a Pan-India optic fiber network. RailTels high speed OFC Backbone Network shall ultimately cover the entire railway network across the country. In high bandwidth backbone segment on a secured and distinct right of way, RailTel occupies a proud place with its unparalleled network. The network has the ability to provide the mission critical customized connectivity platform for enhanced corporate efficiency and growth. RailTel creating Point of Presence at every Railway station enroute which are spaced at 8-10 Kms. The network is spread along the length and breadth of the country covering all the important and major cities including small towns. With the spread and reach, RailTel is in a position to serve 70% of the countrys population. With its collaborative RailWire retail broadband platform, RailTel is able to extend its offering of reliable broadband services to number of retail and enterprise customers across the country. The access network of RailTel in cities and towns spans to another 21000+ kms and helps deliver high speed reliable connectivity to close to 758 institutes of higher learning like IITs, IIMs, IISC, SAC, Agricultural and research institutes and universities across the country. We take pride in sharing that RailTel remains the ONLY consistently profitable, consistently dividend paying company

Telecom space under the Govt of India.

7. Network Architecture:

RailTels OFC based network is designed in defined hierarchical form with Core, distribution and edge layer. RailTels OFC based communication system comprises of various technologies and is capable of delivering telecom services to its customer with high SLA (Service Level Agreement) With the presence of high speed, resilient and state of the art telecom network, backed with differentiated Right of way (RoW), RailTel is capable of delivering high SLA services to its esteemed customers. RailTel is a continuously growing company, technically and financially, to meet all the present and future Telecom and IT requirements of Indian Railways as well as of all government and private sectors.

RailTel has Pan India Telecom Network with capability of Service delivery from 2Mbps to 800Gbps links. RailTel Network comprises of various technologies viz. Next Generation Network (NGN), Synchronous Digital Hierarchy (SDH), Packet Transport Network (PTN), Dense Wavelength Division Multiplexing (DWDM), Internet Protocol- Multi Protocol Label Switching (IP-MPLS) which are maintained by round the clock Network Operation Centres and trained field manpower. Total 11000+ Backbone & Access

PoPs are available. All the equipment provided on the network are of State-of-the-Art Technology and are as per International Telecom Standards.

The glimpse of various networks is as follows:

SDH (Synchronous Digital Hierarchy) Network: Presence across the nation (Pan India) with more than 4500 nodes. The network is capable of providing various services like 10G, 100G, 200G and 800G. The Networks covers all major cities of India and provides high availability of synchronous services.

PTN (Packet Transport Network) Network:

Pan India Presence with more than 400 nodes. The network is capable of providing various services like 1G and 10G. The Networks covers all major cities of India and provides high availability of packet services.

DWDM Network: Pan India presence with more than 200 OADM (Optical Add/Drop Multiplexer) nodes. The network is capable of providing various services like 10G, 100G and 200G. The Network covers all major cities of

India and provides high availability of services.

IP-MPLS Network: Pan India presence with Four Tier Architecture and High availability of Tier-I Nodes. The network is capable of providing services with granularity from 1

Mbps to 40 Gbps. The Network covers all major cities of India and provides high availability of services.

8. Data Centre Services.

RailTel has 02 nos. of Tier-III certified MietY empanelled Data Centres at Secunderabad & Gurugram and MietY empanelled RailCloud to offer IAAS (Infrastructure as a Service), PAAS (Platform as a Service) and SAAS (Software as a Service).

Following ICT Services are being offered by RailTel.

Data Centre and Managed Hosting:

Infrastructure as a Service (IaaS), dedicated hosting, managed services, cloud computing, disaster recovery services and hosted smart city and e-governance services.

HD Video Conferencing Services: end-to-end hosted multitenant video conferencing facility

Security Operations Centre as a Services: cyber security incident prevention and security event monitoring services

ICT Hardware, Software and Service System Integration Projects: undertake ICT hardware implementation, software delivery and digital transformation projects (Content on Demand, Video Surveillance System & Railway Display Network)

Digital Services: Wi-Fi as a service, e-office,

Hospital Management Information System, e-tendering/ e-auction and IoT based solutions.

Hosted e-tendering services to offer online tendering services. Railtel Data Centres are leveraged by many government agencies and PSUs by hosting their IT applications in safe and secure data centre environment. Data centre customers also take leased line and internet services for their users.

With the rapid movement towards digitisation of systems and processes, every organisation needs data centre environment to host applications hence requirement of IT cloud is increasing rapidly. Hybrid cloud is new norm for every IT savvy organisation where workloads are distributed to two or more data centre environments to safeguard interests of organisation in terms of application resiliency.

9. New Initiatives:

RailTel, since its formation, has kept pace with the introduction of new services and technology to keep its relevance in the market. The new service portfolios shall in long run help in increasing revenues as well as fully supplementing the existing services to its customers. During the year RailTel has initiated some new services as detailed in the following paragraphs:

9.1 Hospital Management Information System

RailTel has implemented the work of Hospital Management Information System over 710 health units including 129 hospitals and 581 polyclinics of IR. This is an integrated clinical information system for improved hospital administration and patient health care for providing an accurate, electronically stored medical records.

The features of the software extend from customizing clinical data according to the departments and laboratories, multi hospital features that provide cross consultation, seamless interface with medical and other equipment and the patients will have the benefit of accessing all their medical records on their mobile device. There are about 27 modules of

HMIS which include Clinical, Administrative, Patient Services & Ancillary Modules viz OPD, IPD, Labs, Pharmacy, Referrals, Medical Examinations, Sick-Fit Certifications, Reimbursement of Medical Claims etc.

The open source HMIS software has been deployed over the cloud. This platform is linked to the unique medical ID of employees for which about 50 lacs UMID cards have been issued to the regular employees, pensioners and family members.

IR HMIS (Hospital Management Information System) has achieved a remarkable milestone of successfully reaching 1 crore prescriptions, collaborating with 710 health units in 18 months This incredible achievement is a testament to the dedication and commitment of the entire HMIS team, as well as the trust and support of healthcare professionals and patients alike. With an average of 50,000 prescriptions per day, HMIS is making a significant impact on patient care, streamlining processes, and ensuring efficient healthcare delivery. Our innovative system is empowering hospitals to provide top-notch medical services, while also enabling seamless collaboration among healthcare providers.

9.2 Security Operation Centre

With the world going digital, it is becoming increasingly important to safeguard your data from cyber security threats. To provide a centralized and consolidated cyber security solution to organizations, RailTel has set up a Security Operation

Centre (SoC) at Gurugram.

We provide onsite and offsite cyber security incident prevention and security event monitoring services RailTels Security Operations Centre as a Service (SOCaaS) proactively addresses the increasing threat to Data Security with detection and response capabilities. The security information and event management solutions.

The services provided through SOC are Endpoint detection and response, which provides host level telemetry for both near real-time as well as forensic investigation, Network traffic analysis to investigate alerts and obtain additional context about suspicious activity in the network, Packet capture for forensics, Sandbox for malware analytics, Vulnerability assessment tools, Web application and network firewalls and Auto ticketing tool.

9.3 Railway Station Wi-Fi Services

RailTel is transforming Railway stations into Digital hub by providing public Wi-Fi at all Railway Stations.

6108 stations are live with RailTels RailWire Wi-Fi. This is one of the largest and fastest public Wi-Fi networks of the world being accessed by close to

2 mn unique logins per day. Passengers use this facility for streaming High Definition (HD) Videos, download of movies, songs, games, and do their office work online.

The Station Wi-Fi was very popular with Railway users and the community around Railway stations that it generated global and domestic media attention.

9.4 Wi-Fi Monetization:

RailTel has entered into consortium with private players for monetization of worlds largest Wi-Fi ecosystem through mobile app. This app will help users with services like e-ticketing, travel & stay reservations, porter booking, infotainment etc. This scheme involves minimum guarantee income to Railways and services to more than 23 million users daily.

9.5 Video Surveillance System (VSS)

RailTel is also executing provision of IP camera-based Video Surveillance System at 5102 railway stations. This will go a long way in enhancing the safety and security of the passengers travelling over the IR network. RailTel is also integrating the various standalone video surveillance system installed at various stations by respective zonal railways so that the video recordings can be seen and monitored at the Divisional and Zonal head quarter level centrally. Under the project, all cameras to be provided in station premises will be networked on optical fiber cable and brought to a centralized place (CCTV control room) from where they shall be viewed on multiple LCD monitors by Railways security personnel. The system shall provide high capacity storage devices at stations to store recording of CCTV footage for a defined period. Work has been completed at 308 stations.

9.6 NIC e-office application

RailTel has completed the work of implementing NIC e-Office system for Indian Railways. e-Office project is a Mission Mode Project under the National e-Governance Programme of the Government of India. The project aims to usher in more efficient, effective and transparent government and intra-government transactions and processes. e-Office has been implemented in 236 Units of Indian Railways . During the year, more than 1.47+ lakh users of Indian Railways are using e-Office application, 30+ Lakh e-files have created and 2.41 Cr receipts have been generated.

E-office has proven to be boon in a crisis and part of Railway workforce was able to WORK FROM HOME, which would have been impossible in case of manual filing system. With the success of implementing e-office in Railways, RailTel is implementing same in various universities and Central/State government offices, in with NIC/NICSI including hosting on RailTels cloud.

9.7 Modernization of Railway Control and Command Signalling System

RailTel Corporation of India Limited has been awarded the work of replacement of old mechanical signalling equipment with state-of the-art electronic interlocking system at 26 stations of Northern Railway. The existing mechanical signalling systems are using lever frames to both lower the signal and change the tracks. The new Electronic Interlocking signalling system will now enable lowering the signal and changing of tracks by click of a mouse and will enhance safety and improve efficiency train operation. Work of Electronic Interlocking at NIC09 stations has been commissioned.

RailTel is also working closely with Railways to modernise signalling and train control system through adoption of intelligent and modern control inter- and command signalling system. all

9.8 AI/IOT based services:

RailTel is working on AI enabled OFC acoustic sensing based intrusion detection system on Indian been Railways like movement of elephants in forest areas crossing Railway lines, which may be upgraded to pre-warn railway controllers for any impending landslide or river bank erosion which may cause disruption to railway traffic. RailTel is also working on provision of AI/ML powered digital twin for safer, efficient and future ready train traffic.

9.9 State Wide Area Network

RailTel is also helping create and maintain the State

Wide Area Networks (SWAN) in various States of the country. In Haryana RailTel is maintaining the complete SWAN IT infrastructure and upgrading the same where ever required. In Kerala, RailTel is upgrading the State Wide Network with new generation equipment and providing Facility

Management Services. Work of upgrading the ORISSA SDWAB has been entrusted to RailTel.

10. R&D and Innovative Initiative

RailTel is continuously improving its services and developing new projects and thus involved in various R&D and innovative initiatives. During financial year 2022-23 RailTel has spent Rs.5.37 Cr towards following initiatives:

Enhanced Automation in its CNoC operation:

RailTels fully automated helpdesk, developed with ticketing system but also resulted in significant cost savings. Customers can now initiate tickets themselves via the self-service portal, leading to increased satisfaction, reduced response time, and minimization of manual errors. The automated

Interactive Voice Response (IVR) allows customers to create tickets by just dialing in the circuit ID, further eliminating manual intervention.

Unified IP & DWDM management: Harnessing the power of OpenNMS, weve achieved a unified management of IP and DWDM which has significantly streamlined our network operations

This approach has reduced the necessity for manual tracking two different NMS, thereby freeing up resources and time. The automation of alerts, sent to concerned users via Telegram, reduces delays in communication and ensures that the necessary actions can be taken promptly.

Operational network map: Our initiative maps the pan-India high-capacity network of RailTel onto the geographical map of India, illustrating nodes and their connectivity statuses. Integrated with our ticketing tool (HPSM), this map visually displays any registered failures by changing the color of the corresponding node or connectivity as per severity.

This birds-eye view of our network operations is accessible to everyone, from senior management to field staff. The Operational Network Map significantly improved our failure Mean Time Repair (MTTR), promoting better coordination and escalation due to its single-pane, comprehensive view.

Cyber security enhancement via the SoC services portal: The SOC Services Portal is a vital tool in RailTels commitment to security. It acts as a one-stop platform for delivering antivirus solutions and cataloguing antivirus installations among

RailTel employees, effectively handling more than 300 such requests. This portal also serves as an interface to facilitate system hardening requests from employees, having managed over 75 of these requests. Additionally, it performs a critical role in raising cybersecurity awareness among end-users, while offering easy access to security reporting tools such as a web access log analyzer, IP/HASH reputation check, and SSL protocol and cipher suite checks for advanced users.

Use of Ansible for automated tasks: Ansible tower has been strategically employed to automate routine tasks performed by the Data centre team, enabling delegation to Level-1 support, thus eliminating the need for sharing elevated privileges. For example, in e-Office Service Management, the implementation of an Ansible playbook eliminated the requirement for an admin for the frequent restarting of services, and instead, the Level-1 support team can handle it. Likewise, for e-Office EFILE on-click log collection, the implementation of Ansible with an external File server has streamlined the log collection process.

Similar approaches have been applied for RHEL, Cisco, and Dell server log collection at the physical and virtual machine level.

Server farm record keeping portal: RailTel utilizes a comprehensive Server Farm Record-Keeping Portal, an intuitive interface designed for efficient management of hardware appliance provisioning and rack space within any data centre environment. This platform ensures seamless record-keeping, contributing significantly to the optimization of data centre operations.

11. Existing Services

While the new areas of business open additional avenues for RailTel, RailTel continues its focus on the present services being offered.

11.1 NLD Services

Continuing the efforts in NLD segment, RailTel has pursued its high capacity services from Lease Line growth especially with Government departments, Enterprises, Banks, etc. Last year also saw positive traction in leasing of circuits by MNCs, Govt. customers, Telecom operators and MSOs. Selection of RailTel as one of the major partners in National

Knowledge Network (NKN) has contributed significantly in revenues from NLD services as demand for higher capacities is expected in this network. RailTel has generated 569 Cr. revenue from this segment.

11.2 IP-1 Services

Tower collocation business translates to a good alternative for RailTel to monetize its towers infrastructure. Dark fiber leasing is a strategic customer engagement product for RailTel. The sector needs renewed focus as it is the highest bottom-line business with added advantage of extensive last mile access as a reciprocal arrangement. RailTel is also refocusing on managed services. This shall help in further consolidating its market with existing customer arrangements with all mobile operators across India to lease these sites for collocation purposes. Till Mar23, RailTel has generated 215 Cr. revenue from this segment.

11.3 ISP Services

RailTel is also providing Nationwide Internet & Broadband services to all major customer segments like ISPs, Educational Institutions and various Government departments. During the year RailTel has bagged several orders from various Government departments, PSUs and educational institutes. RailWire broadband services have registered net growth of 52000 new subscribers in FY 22-23 with 5,16,000+ active subscriber base on Mar 23. Around 8673 Local Cable Operators have partnered to provide last mile connectivity to end consumers.

Total revenue of 318 crores was achieved during the year.

11.4 Service to Railways

RailTel was established with the vision to modernize Railways train control, operations and safety system networks. Over the years, RailTel has implemented various telecom & IT infrastructure projects as well as various Value-Added Services for Indian

Railways. This facilitated in spreading various Railways applications to remote and rural stations thus increasing customer satisfaction.

RailNet: RailTel has provided RailNet, the intranet of Indian Railways, over MPLS VPN. RailNet connects Railway Board with all Zonal, Divisional, Sub-divisional Hqs Production units, CTIs, RDSO & all other units. This secured and dedicated network is used for video conference, voice and data transfer by IR.

Short haul connectivity (station to station):

RailTel has created STM-4/STM-1 based network at every station to support data connectivity requirements from Indian Railways such as supporting the transfer of PRS/UTS/ FOIS/mission critical information along with carriage of voice traffic such as emergency communication during disaster management.

Long haul connectivity: RailTel provides MPLS based Wide Area Network (Railnet) to support administrative data communication needs of various field organizations of Indian Railways The network interconnects Ministry of Railways with 18 Zonal HQs, 67 Divisions offices, Production units, for sharing of information from all depts. RailTel is now in the process to connect all Tier-1 PRS centre on MPLS VPN connectivity with the disaster recovery site of CRIS which shall increase the reliability of these links.

Broadband: In addition, RailTel has commissioned Digital Subscriber Line Access Multiplexer (DSLAMS) on existing Railway exchanges to provide Broadband services to more than a lakh of homes and offices of

Railways in both urban and rural areas using the existing Copper wire last mile of Railways. This shall not only help Railway employees but shall also help in increasing Broadband penetration in the country in line with the National Telecom Policy.

11.5 Data Centre

RailTel has two UPTIME (USA) certified Tier& MeitY Empaneled Data Centers in place at

Secunderabad and Gurugram.

RailTel offers a host of Data Centre services like Colocation Services, Managed services, Cloud Computing, Managed e-Office, Authentication Services, Dedicated Solutions etc, from these two state-of-the-Art Data Centres with combined total gross capacity of more than 6000 Sq.ft Server Farm area.

RailTel cloud services are backed by SLA of 99.95% and co-location services by SLAs of 99.983% which is one of the best by industry standard. The USP of RailTel Data centre is round the clock multi- layered Physical security at different levels, Very Early Smoke Detection System, IP CCTV System, Access Control System, Water Leak Detection System, Rodent Repellent System, and Building Management System. The on-site power system with redundant diesel generators feeding a N+N redundant UPS grid to offer the highest levels of power reliability Besides Indian Railway, a number of Government customers trust RailTel for the Data Centre services. RailTel Data Centres are empanelled with MeitY for providing cloud services to Govt. Departments & PSUs.

11.6 Telepresence as a Service (TPaaS)

RailTels TPaaS an end-to-end, high-definition videoconferencing service that gives users a virtual, face-to-face meeting experience was launched in January-2015. Before adoption of TPaaS Indian Railways were spending huge amount of money and man hours for meetings and events. Post adoption of TPaaS the number of travels for meetings and events has dropped drastically saving manhour, travel and lodging expenses. Extensively used for inauguration of Rly facilities across India.

Being swifter, faster in decision making and crisis handling, lesser travel for meetings and events has also helped in saving significant amount of carbon footprints. The service now serves 686 elite users across including 380 railway customers. The success is a result of the significant ease of use & 24X7 customer responsiveness of the RailTel team vis-a-vis the challenges faced with other service providers.

The RailTel Telepresence Services have often served events for the Honble Prime Minister of India, Minister of Railways, Minister of Industry & Commerce & Minister of Civil Aviation reaching out to places where making available even OB Vans would have been difficult at short notice The services are offered on a monthly subscription basis requiring no investment into CAPEX by the customer while obviating the recurring need for investment due to technology obsolescence.

11.7 SI Project Business

Continuing the efforts in Service Integrator business,

RailTel has focused on SI Business during the year & various high volume orders for various government agencies such as Coal PSUs, Delhi Safe City, AFNET, OSWAN, MP State Govt, Puducherry Govt, CDAC, Banks and some Strategic organisations have been received.

12. Facilitating Government of India Initiatives

12.1 National Optical Fiber Network

The Government of India has approved the project for the creation of a National Optical Fiber Network (NOFN) for providing Broadband connectivity to all

2.5 Lac Gram Panchayats (GPs), which has now been rechristened as ‘BharatNet.

Under the Phase-I of this project. RailTel was assigned the BharatNet work in Gujarat, Daman & Diu, Dadar & Nagar Haveli, Puducherry and Northern Eastern region states (Tripura, Meghalaya, Manipur, Mizoram, Nagaland & Arunachal Pradesh.). RailTel has laid over 27000 Km OFC and completed 8107 GPs. Work has been closed in March 2023.

13. Blueprint for the Future

Over the past few years, there has been continuous pressure on telecom companys revenue with traditional products and services. The pandemic accelerated and amplified the trends that were already existing in companies, it also led to development of new products and services. There has been business model disruption with technologies like AI, Big data and IoT.

Considering the dynamic nature of Telecom & IT industry, it is always pertinent to closely look into the future & work out the strategy for the company. With this aim, RailTel keeps revisiting its policies, new areas of business and new customers areas. It is pertinent to have more services under RailTels portfolio to cover entire gamut of Enterprise services which shall provide further growth trajectory for RailTel. RailTel now needs to focus on value addition capabilities in the area of Data Centre centric services such as managed services & cloud, LTE (Long Term Evolution), IOT (Internet of Things) Platform and Analytics, SOC, KAVACH (Traffic Collision

System), etc. In some areas these can be developed effectively using partnership models ensuring risk mitigation while delivering such services. In order to realize the vision of being the preferred telecom solutions and service provider for knowledge economy, RailTel would be following a three-pronged strategy of concentrating on optimizing the products & services bouquet, expanding the network and upgrading to a high capacity network.

Products & Services: RailTel is continuously focusing on providing value added services through partnership models supported by RailTels existing network and cloud for enterprise segment. A new data centre and Edge data centres on revenue sharing model are some of the services in the pipeline. RailTel has a dedicated new product development process that enables RailTel to roll out quality products and services in the fast-paced technology industry.

Network enhancement: RailTel believes that its extensive network is its key differentiator in the market and hence a key value proposition in delivering services to its customers. RailTel thus plans to invest in upgradation of backbone network, upgradation of CNoC, Access network, 100G to 800G network at prominent locations through procurement of routers, power plants, charges and state of the art latest equipment.

Cyber Security:

With the entry of 5G services, there would be rapid shift in the services and operating model of delivering services, with wider adoption of evolving technologies like IoT, AI/ML and AR/VR, convergence of services, Digital trust would be one of the key components for the services being consumed. For this, cyber security is a new area which offers lot of opportunities. We have strategically decided to enhance our capabilities to serve this market as robust cyber framework, strong data governance will enable RailTel in building digital trust and customer centric services.

Other Services/Products: RailTel has been implementation partner in various IT, Smart city, E-gov projects of Central/State Govts. RailTel is also providing Consultancy for ICT services, and

Aadhar based authentication services etc. Focus will also be on various Railway projects like signalling, LTE-R, Kavach, Station modernization, Drone based services, AI/ML powered applications for safer and better tomorrow, modern control and command signalling including consultancy.

International Business: RaiTel shall also be entering into the domain of international business, especially ICT, Railway infrastructure, competence development etc.

Organization Design: RailTels organisational design is continuously evolving to suit changing business needs such as the Companys entry into enterprise IT services and execution of ICT projects & initiatives launched by the Central Government and various State Governments. Internal Processes: RailTel believes that strengthening of internal business processes is essential for efficient customer service delivery cost efficiency that in turn would enable for higher investments in the future. RailTel is continuously improving key business processes such as service assurance, key account management, management information systems (MIS) to improve competitiveness.

14. ESG and Sustainability

Efforts are continuously being made by RailTel by adopting and implementing adequate mechanisms which include reorientation of policies so that the company remains ESG compliant not only in letter but in spirit as well. RailTel has brought into place policies so as to conduct Business in a manner that is ethical, transparent and accountable; provide services which are sustainable and safe; ensure the well-being of all employees in regard to their health, leave benefits, training, skill and career development.

RailTel respects and promote human right. It provides equal opportunities to all. Disclosure of complaints on discrimination/ harassment/ unequal treatment at workplace is mandatory. RailTel implements the Govt. of India policies/ guidelines issued from time to time including the rights of

Person Disability Act, 2016. RailTel has brought into place the Business practices to protect and restore the environment, Energy Conservation Measures and monitoring of emissions etc.; Accountability for waste generated, recycled, reused and disposed-off have been defined. Disclosures on Environmental

Impact Assessments (EIA) and impact on biodiversity is stressed upon. RailTel promotes inclusive and equitable development through CSR activities. It has a robust Grievance redressal mechanism in place. Guidelines have been numerated to provide value to the consumers in a responsible manner. A detailed Business Responsibility and Sustainability Report (BRSR) report is separately available in the Annual Report.

15. Financial Performance

During the financial year 2022-23, total consolidated revenue from operations earned by RailTel is 1964 crore. Profit after Tax earned has been 189 crore and Profit before tax has been 255 crore. From &NLD (Bandwidth & VPN) services, RailTel earned 569 Crore during the year. While earning from IP-1 services has been 215 Crores which includes revenues from tower & rack colocation and Dark fiber leasing. While under ISP license (Internet & Broadband) RailTel has achieved revenues of 380 Crores. The revenue from RailWire, broadband service of RailTel, for the year is 318 Crores.

16. Awards

During the year 2022-23, RailTel received following awards for its excellent performance from various organizations:

• RailTel won the South Asian Federation of Accountants (SAFA) award- certificate of merit for Integrated Reporting and Corporate Governance Disclosures 2021.

RailTel has been conferred with the Dun & Bradstreet Award 2022 in the Telecommunication

& Information Technology (Central PSUs) category.

• RailTels Corporate Communication team has been featured in the Reputation Today Top 30

Corporate Communication Team in India list 2022.

• RailTel was felicitated at Rail Analysis Innovation and Excellence Summit 2023 for excellence towards Telecom Solutions and Connectivity across the Rail network.

• RailTel received the Governance Now PSU award in the category of ‘Use of emerging technologies-Cloud in the 9th PSU awards and conference. RailTels RailCloud is MeitY empanelled reliable Cloud service.

RailTels Rajbhasha magazine "RailTel Pragati" was honoured with the first prize by Nagar

Rajbhasha Karyanvyan Samiti (NARAKAS) amongst the 44 entries in the best magazine category. The magazine was also conferred with the Silver Award in the 16th Global

Communication Conclave organized by the Public Relations Council of India.

RailTel received Bronze award in the Best

CSR communication campaign for the communication campaign ran for RailTels

CSR projects in Rajur, Maharashtra, in the 16th Global Conclave organized by Public Relations

Council of India.

RailTel has been conferred with the Data Centre

Champion award at the Express Computer event organised by Indian Express group.

17. CSR Initiatives

RailTel is actively involved in meeting its social obligations through the Corporate Social Responsibility programme and is actively supporting programmes for Digital Literacy, Education, Health and Physically challenged children. RailTel contributed an amount of Rs. 436.87 Lakh in FY 2022-23. Following major CSR initiatives were undertaken in FY 2022-23: a) Treatment of Congenital Heart Disease for poor children who cannot afford such treatment, at subsidized rates at Artemis Hospital in Gurgaon. b) SEHAT Centre at Purulia, West Bengal: intends to improve the availability and access to quality health care to women specially in the area of

Menstrual Hygiene, Eye check-up, supplement services for Pregnant & Lactating Women.

c) Medical Health and Dental check-up camps in Ferozepur, Punjab for poor and needy people for conducting preventative and diagnostic health check camps for the public and focusing on special care of poor and needy persons, providing free medicine and treatment of dental issues. d) Digital learning with smart classes for students at 05 government schools at aspirational district Haridwar, Uttarakhand. This will help school students be in synch with latest trends and help the learn the subjects in easy and fun way with digital learning tools.

Digital Classrooms e) Vocational training centre for youth at

Bhokardan, Jalna and Maharashtra These centres are training the youth from nearby villages in skills like computers soft skills, tailoring and beautician skills. f) Jal Sanchay programme in aspirational district

Karauli, Rajasthan with activities like community mobilization, construction of check dam/Anicut for water recharge and water restorage, Leach pit for water recharge in slopy area, pond digging & repairing, plantation of about 4000 plants and development of green belt in area. g) RailTel, in association with Centre for Social Responsibility and leadership, New Delhi, has established RailTel- Akansha Super 30 centre where 30 underprivileged but talented students from different corners of Uttarakhand are provided free residential coaching and mentoring for 11 months for admission in reputed engineering colleges like IIT, NIT and state engineering colleges.

18. Human Resources

RailTel has made a conscious effort to keep evolving its practices in Human Resources and providing best experience and convenience to its employees. To improve on its employee score, RailTel has implemented e-office and ERP which enables employee to perform all work related activities online bringing efficiency & in working This initiative has benefitted most to the employees deputed in fields who can now work without a visit to territorial/regional offices.

Keeping pace with the requirements of future requirements and new service diversifications,

RailTel is continuously recruiting experienced and qualified manpower from different fields.

At the end of Mar23 total manpower strength was 827 including regular, deputationist, contractual, re-employed, consultants and Advisor.

19. Health and Safety of Employees

RailTel as an organization provides a safe working environment for employees by incorporating safe equipment and safe procedures at the workplace to ensure worker safety. Various steps and initiatives taken for health and safety improvement of its Human Resource during the year following initiatives were taken:

RailTel organized COVID-19 Booster dose vaccination camp for its employees.

A complimentary health check-up camp in collaboration reputed Hospitals was organized for the employees of RailTel at EKN and Gurgaon respectively. The health check-up included Blood Sugar, BMI, BMD, Pulmonary Function, ECG, eye check-up and Dental check-up etc.

On the occasion of World Cancer Day (4th February), a health talk on the role of lifestyle in the management of lifestyle diseases was got organized. The keynote speaker was Dr. Asha Sharma/Senior Consultant/Obstetrics and Genealogy/Artemis Hospital.

An interactive talk was held by doctors of Sir Ganga Ram Hospital on Nutrition & Healthy Living & Skin Care on the occasion of International Womens Day.

RailTel celebrated International Day of Yoga on June 22 on pan-India basis.

20. Cautionary statement

Statements in the Directors Report and Management Discussion & Analysis, describing the Companys objectives, projections and estimates, expectations, predictions etc may be "forward looking statements", within the meaning of the applicable laws and regulations. Forward looking statements contained herein are subject to certain risks and uncertainties that could cause actual results to differ materially from those reflected the forward-looking statements. Actual results, performances or achievement may vary materially from those expressed or implied, economic conditions, Government policies and other incidental factors such as litigation and industrial relation. Readers are cautioned not to place undue conviction on the forward-looking statements.