The government of India is examining a new idea that could change how people pay for mobile internet.
Officials are studying whether mobile data usage should be taxed, which could create a new source of revenue for the telecom sector.
The discussion took place during a telecom sector review meeting chaired by Narendra Modi
During the meeting, the Department of Telecommunications was asked to study how a data usage levy might work in practice.
At present, most government revenue from telecom comes from spectrum auctions and licence fees paid by telecom companies.
With internet usage growing rapidly across the country, policymakers believe mobile data could also become a significant revenue source.
According to government estimates, India consumed around 229 billion gigabytes of mobile data in FY2025.
If a small tax of ₹1 per GB were introduced, it could generate nearly ₹22,900 crore in revenue.
Why the Government Is Considering a Data Tax
The proposal is not only about raising revenue. Officials are also linking it to concerns about excessive smartphone use, especially among children and teenagers.
India’s Economic Survey 2026 has already warned about the social and mental health effects of too much screen time.
Policymakers believe economic tools like data pricing or taxation might encourage people to use the internet more responsibly.
The idea is to design a system that supports productive digital activity while discouraging excessive or addictive usage.
However, the proposal has triggered debate within the telecom industry.
Some experts say that taxing mobile data could be difficult to implement and might slow down India’s fast-growing digital economy.
Others worry that higher data costs could affect millions of users and reduce innovation.
Government Also Reviewing BSNL Workforce
The meeting also discussed reforms at Bharat Sanchar Nigam Limited, the government-owned telecom operator.
Officials noted that the company currently has a much larger workforce compared to private telecom firms. As of March 2025, BSNL had about 54,875 employees.
Employee costs alone account for more than 37 percent of the company’s operating revenue, which is significantly higher than private competitors.
Because of this, the government has asked authorities to review employee roles and consider options such as staff reduction or redeployment to improve efficiency.
Focus on Telecom Security and Local Manufacturing
The review meeting also addressed several long-term telecom priorities.
These include strengthening network security, improving undersea cable infrastructure, and increasing domestic manufacturing of telecom equipment.
Currently, India relies heavily on foreign suppliers for key telecom components, including equipment used in 4G and 5G networks.
The government has therefore asked officials to create a roadmap to increase local production and reduce dependence on imports.
These steps are part of a broader effort to strengthen India’s telecom infrastructure while supporting the country’s expanding digital economy.
