India Offers Nigeria $100m Loan for Rural Internet

Nigeria’s aspiration for universal internet coverage has received a boost with the materialisation of a $100 million loan from the Government of India.

The facility arranged by the EXIM Bank of India is the result of a close collaboration between the India High Commission in Nigeria and the Federal Ministry of Communications. The deal was facilitated by the immediate-past Minister, Alhaji Adebayo Shittu, who had promised a 70 per cent broadband penetration by 2021.

The loan from India is expected to accelerate the deployment of solar-based mobile telephone sites in the country’s vast rural areas. Officials of the communication ministry privy to the details of the plan said no fewer than 1,000 sites can be built within 12 months once the two countries seal the agreement.

The credit facility from India is expected to be devoted to financing Nigeria’s Rural Broadband Network and the deployment of robust masts that will rely on alternative power sources, especially solar power. The plan is hinged on government’s determination to extend telephone services to all rural communities at relatively affordable cost while ensuring that identified bottlenecks experienced in urban areas are minimised.

Early this year, Shittu had disclosed that the government was desirous of fast-tracking the implementation of the National Broadband Roadmap by rapidly deploying less-expensive telecoms masts in the rural and remote areas. The plan, he explained, would provide access to telephone services and rapidly increase broadband penetration in hitherto hard-to-reach regions of the country.

The latest statistics from the Nigerian Communications Commission (NCC) has indicated that broadband subscription stood at 63.2 million while actual broadband penetration increased to 33.13 per cent in May this year.

“I am optimistic that if we put all the current efforts together, in another two years, we should be able to attain 70 per cent. My ambition is two years rather than the five years being postulated,” the former minister said at a conference organised by the Association of Telecommunications Companies of Nigeria in February this year.

The minister premised his hope on the $100million loan from India, saying: “The current mast that the telecom operators use is very expensive to maintain. They rely on electricity, and we do not have electricity all around the country. So we have a situation where somebody who wants to build a mast of N40million would also have to acquire a 200KVA generator and fuel it.

“For this reason, we have redirected our effort at getting solar-based masts which will also have 50km radius so that if you have a land area of 100km, you will have two masts. It is cheap to maintain and all operators can depend on it, rather than having the rural operators to construct their own masts or lay their own cables.

“We are doing all of these, and I believe that within the next two months, we should have an approval from the Indian Government for work to commence on deploying this to all rural areas in Nigeria”

Figures from the NCC indicate that there are about 120 million internet users in Nigeria, most of them in the urban areas. Internet penetration is a little above 33 per cent, although the commission is working with the National Broadcasting Commission (NBC) to introduce Television White Space to further deepen broadband penetration.

Although the Nigerian communications industry has attracted huge investments of recent, experts believe that a robust telecommunications network is important for economic growth in the country. Indeed, the Executive Vice Chairman of NCC, Prof. Umar Dandatta, has noted that while the present portfolio of $68 billion investment in Nigeria is huge, it is by no means adequate for one of the fastest growing telecommunications markets in the world.