Digital connectivity in the Bay of Bengal region and beyond BIMSTEC Secretariat. Dhaka. March 19, 2018 Abu Saeed Khan, Senior Policy Fellow LIRNEasia, [email protected]

Global growth indicators • Flow of goods 10.5x in 34 years • 1980-2014

• Flow of services 3.1x in 12 years • 2002-2014

• Flow of people 1.6x in 11 years • 2002-2013

Source: UN World Tourism Organization; UNCTAD; McKinsey Global Institute analysis

Flow of bandwidth 45x in 9 years!

Source: TeleGeography; McKinsey Global Institute analysis

Global Submarine Cable Map

• Nearly 300 submarine cables spanning over 500,000 miles across the world’s seabed are the primary pipeline of transcontinental Internet. • They are also responsible for $10 trillion worth of transactional value every day. • It is greater than the GDP of Japan, Germany, and Australia combined.

Source: TeleGeography

“It’s a big deal.”

U.S. Federal Communications Commission Commissioner Jessica Rosenworcel's statement on September 17, 2015

$0.60 $0.60 $0.61

$0.67 $0.67 $0.78 $0.80 $0.88 $0.91

Dallas Washington London

Toronto Moscow New York Miami Los Angeles Istanbul

$3.77

Seoul

$7.69

Mumbai

$10.91

Weighted Median Monthly IP Transit Prices per Mbps: Asia’s highest is 12x pricier than Europe’s highest

Bangkok

$7.25

$7.24 Jakarta

Kuala…

$3.60

Taipei

$2.24

$0.60

Chicago

Tokyo

$0.59

Frankfurt

$1.83

$0.58

Oslo

Hong Kong

$0.54

Milan

$1.79

$0.53

Amsterdam

Singapore

$0.45

Paris

Source: TeleGeography Data derived from Q2 of 2017

28.6

21.9

20.3

20.2

16.9

16.0

14.7

11.0

9.5

8.9

8.5

7.6

7.2

6.5

5.5

Average speed in Asia (Mbps)

23.5

22.5

21.7

20.1

17.4

17.0

16.9

16.9

16.6

16.3

15.6

15.5

15.5

15.3

Average speed in Europe (Mbps)

20.5

Fest and Famine of Broadband in Asia

Source: The State of the Internet / Q1 2017, Akamai.

Slower or faster than European counterparts Average speed in Mbps 5.1

-3.2

-2.3

-1.4

-1.4

-0.6

-0.3

-5.9

-9.8

-9.0

-8.3

-8.0

-7.8

-7.7

-7.4

Source: The State of the Internet / Q1 2017, Akamai.

Issues keeping Asia’s bandwidth pricier

Fierce competition •Coast-coast terrestrial TX

Poor competition

Broadband’s biggest barrier

Very good competition •Terrestrial & submarine TX

All submarine TX

A bilateral move that is shaping global trade

Rolling on Belt and Road

China Unicom exploits ‘Belt and Road’ Plugging AAE-1 across Pakistan and Myanmar Source: People’s Daily online (March 2, 2016)

Terrestrial link to the Arabian Sea

Terrestrial link to the Bay of Bengal

What difference should it make? • Earlier: Nepal Telecom’s monopoly + Indian carriers’ duopoly • Market distortion within and beyond borders, high risk of disconnection, poor quality

• Now: Nepal Telecom’s monopoly + (Indian carriers’ duopoly + China Telecom) • Market distortion within borders, no risk of disconnection, no major change in quality

• Next: Competition among carriers, wholesale price war, improved quality

Small step of Bangladesh for a multilateral giant leap • Prime Minister Sheikh Hasina has approved the amendments to Asian Highway agreement on August 13, 2016. • It paves the way to deploy optical fiber using 145,000 km right-ofway to digitally interlink Asia and plug the continent with Europe.

• •

145,000 km meshed across 32 countries (12 landlocked). Seamlessly connects Asia and Europe.

Each country’s share in Asian Highway

Bangladesh has proposed • Annex II (ASIAN HIGHWAY CLASSIFICATION AND DESIGN STANDARDS) Insert as paragraph 11: Co-habitation of optical fiber for strengthened ICT connectivity

"There is an opportunity to leverage synergies between the concomitant deployment of optical fibre cables with the construction or maintenance of the Asian Highway Network. Such co-deployment would create additional cross-country Internet transmission routes which would contribute to the reduction of the digital divide in the ESCAP region. In this regard, parties shall endeavour to utilize the right-of-way of the Asian Highway Network for the co-deployment of optical fiber cables across and within countries."

Bangladesh has proposed • Annex II (ASIAN HIGHWAY CLASSIFICATION AND DESIGN STANDARDS) Insert as paragraph 11: Co-habitation of optical fiber for strengthened ICT connectivity

"There is an opportunity to leverage synergies between the concomitant deployment of optical fibre cables with the construction or maintenance of the Asian Highway Network. Such co-deployment would create additional cross-country Internet transmission routes which would contribute to the reduction of the digital divide in the ESCAP region. In this regard, parties shall endeavour to utilize the right-of-way of the Asian Highway Network for the co-deployment of optical fiber cables across and within countries."

Infrastructure Investment Needs by Sector, 2016–2030 ($ billion) Baseline Estimates Sector

Power

Investment needs

Annual Average

Climate-adjusted Estimates

Share (%) of Investment Total needs

Annual Average

Share (%) of Total

11,689

779

51.8

14,731

982

56.3

Transport

7,796

520

34.6

8,353

557

31.9

Telecommunications

2,279

152

10.1

2,279

152

8.7

Water and Sanitation

787

52

3.5

802

53

3.1

22,551

1,503

100

26,165

1,744

100

Total

Source: Meeting Asia’s Infrastructure Needs, ADB, 2017.

• Much of the future infrastructure investment will go to maintenance and rehabilitation.

• Ratio of new investment to maintenance and rehabilitation is 4:3 (Baseline estimates) and 3:2 (Climate change costs). • Maintenance and rehabilitation account for a larger share than new investment due to high depreciation ratios. • Moreover, year-specific projections show that maintenance and rehabilitation play an increasingly important role when infrastructure stock increases. Source: Meeting Asia’s Infrastructure Needs, ADB, 2017.

Bangladesh has proposed • Annex II (ASIAN HIGHWAY CLASSIFICATION AND DESIGN STANDARDS) Insert as paragraph 11: Co-habitation of optical fiber for strengthened ICT connectivity

"There is an opportunity to leverage synergies between the concomitant deployment of optical fibre cables with the construction or maintenance of the Asian Highway Network. Such co-deployment would create additional cross-country Internet transmission routes which would contribute to the reduction of the digital divide in the ESCAP region. In this regard, parties shall endeavour to utilize the right-of-way of the Asian Highway Network for the co-deployment of optical fiber cables across and within countries."

Bangladesh has proposed • Annex II (ASIAN HIGHWAY CLASSIFICATION AND DESIGN STANDARDS) Insert as paragraph 11: Co-habitation of optical fiber for strengthened ICT connectivity

"There is an opportunity to leverage synergies between the concomitant deployment of optical fibre cables with the construction or maintenance of the Asian Highway Network. Such co-deployment would create additional cross-country Internet transmission routes which would contribute to the reduction of the digital divide in the ESCAP region. In this regard, parties shall endeavour to utilize the right-of-way of the Asian Highway Network for the co-deployment of optical fiber cables across and within countries."

“It was not the British government that seized India at the end of the 18th century, but a dangerously unregulated private company headquartered in one small office, five windows wide, in London, and managed in India by an unstable sociopath – Clive.” William Dalrymple The Guardian

Diplomacy to decolonize Internet Thank you