Amid diesel supply constraints triggered by the ongoing West Asia war, the government’s review of telecom operators and tower firms’ complaints has laid bare a crucial gap: the sector’s “critical infrastructure” tag is not ensuring priority fuel access on the ground. This threatens network continuity, especially in areas reliant on diesel-fuelled power backups, putting essential services—from hospitals to law enforcement—at risk of disruption.
Despite its formal classification under national critical frameworks, telecom infrastructure continues to face uneven state-level curbs on diesel sales and movement. With operators flagging rising outages and seeking urgent intervention, the issue underscores how last-mile implementation gaps can undermine a sector that underpins everyday connectivity and emergency response.
Critical infrastructure—that includes other sectors such as energy and power, transport, financial services—typically refers to systems and assets essential for the functioning of the economy and society, where disruptions can have a significant impact on public services and safety.
With the US-Iran war, going on for the past one-and-a-half months, hurting energy supplies, telecom players sought government's intervention to resolve issues related to priority access to fuel and power. Last month, operators and tower companies approached the government seeking priority electricity supply for mobile tower sites and a continued liquified petroleum gas (LPG) supply in the wake of some constraints imposed by oil marketing companies.
On 30 March, tower companies—represented by the Digital Infrastructure Providers Association (DIPA)—again complained about being denied sale of diesel in drums by fuel stations in states such as Maharashtra, Uttar Pradesh, Arunachal Pradesh and Madhya Pradesh. For context, owing to war-induced supply constraints, many state governments have restricted the sale of diesel in drums and cans.
“Due to this, continuity of telecom connectivity is getting adversely affected, resulting in potential outages impacting essential communication services to the public at large, including but not limited to, all government offices, hospitals, law enforcement agencies/authorities, educational institutions, banking, etc,” Manoj Kumar Singh, director general of the association said in the 30 March letter to the government.
To be sure, tower companies need diesel daily to refuel generators at mobile tower sites to ensure continuous network connectivity. Rampant power outages at certain sites, especially in the rural areas, require power backups.
Telecommunication services are defined as essential services under the Essential Services Maintenance Act 1968 (Esma) as well as critical telecommunication infrastructure under the Telecommunications Act 2023. “Further, these are service of public utility and are lifeline infrastructure under other enactments, and as such uninterrupted network service is essential,” Singh said.
Government steps in to ease curbs
Last week, the department of telecommunications (DoT) had intervened and asked states to grant telecom operators and infrastructure providers the necessary exemption or relaxation from the purchase curbs for an uninterrupted procurement, transportation, and storage of diesel in drums/gallons for telecom sites.
The department urged state governments to ensure seamless supply of diesel to telecom installations and recognize telecom services as essential and critical infrastructure. In its communication to state governments, it said an exemption from the curbs will help ensure continuity of telecom services, particularly in emergency situations, disaster response scenarios and in maintaining connectivity for citizens and government agencies.
Centre-state divergence
Analysts and industry executives said there is a mismatch between central-level policy intent and implementation by states, which could create operational challenges for operators in disruption scenarios.
Earlier too, with regard to implementation of the Centre’s telecom right of way (RoW) policy, various states had delayed the process and permission to telcos for laying infrastructure and charged higher prices than what was notified by New Delhi.
Beyond the Centre-state disparity, telecom operators, represented by the Cellular Operators Association of India (COAI), had also flagged permission and pricing related issues for laying telecom infrastructure at airports and metro stations. The government then intervened and wrote to the airports and different ministries for necessary alignment.
“Telecom is predominantly a central subject, and therefore implementation for various policies at state-level has always been a challenge, irrespective of the critical infrastructure tag,” said Satya N. Gupta, former principal advisor at the Telecom Regulatory Authority of India (Trai). “Either telecom can come under the concurrent list of Centre-state subjects for better coordination, or there should be state-level regulators for on-ground policy implementation.”
Other experts said the diesel supply issue is more related to the abrupt changes taking place. Vinish Bawa, partner and telecom sector leader at PwC India said that this "is less a structural gap and more a transitional challenge. The critical infrastructure tag is well established, and this provides an opportunity to strengthen last-mile alignment, so priority access during disruptions becomes seamless.”
Bawa said the right of way challenges reflect the complexity of a system, rather than a fundamental flaw. The direction is positive, with increasing alignment to central guidelines, and the implementation consistency will continue to improve, he said.
Prashant Singhal, partner and India markets leader at EY, said the solution could be the use of technology. “Digitizing some of the procurement process for telecoms infrastructure is likely to overcome challenges in future. For example, centralizing diesel procurement through an online portal would help to better coordinate and plan for any disruptions,” he said. “We can take a cue from Sri Lanka, where they have implemented a QR-code based system to manage fuel distribution. This will help to monitor usage, streamline the refuelling process and at the same time, ensure minimal operational disruption.”
With the current blockade of the Strait of Hormuz, a key conduit for global oil supplies, constraints in procuring fuels as also the price rise will likely increase the fuel cost burden of telecom operators, as per a 6 April note by brokerage house IIFL Capital.