"Today, there is a phone connection for every three persons and the target is to provide 50 crore connections by 2010," President Pratibha Patil said in her address to the joint sitting of Parliament.

Government has issued 120 new telecom licences in January last year and once they start operations the telecom density, which stands at 33 per cent now, is expected to grow significantly.

Besides increased coverage, the entry of new players is likely to bring mobile tariffs further down. Communication and IT Minister A Raja had said that local call tariffs can come down by 50 per cent to 25 paise a minute while domestic long distance (STD) charges can fall to 50 paise.

"My government has taken a number of steps to ensure that reach of affordable telecom services is greatly enhanced," the President said.

The government has also amended the Indian Telegraph Act to take the mobile services in the rural India, which has been left uncovered largely due to restricted returns on the investments.

"Through amendments to the law initiated by my government faster expansion of mobile services in rural areas has been made possible through use of Universal Service Obligation (USO) Fund for such services," Patil said.

The USO fund, hitherto, was available only for the basic service providers as mobile services was always considered a premium service and this was resulting in poor rural coverage of telecom services.

With the USO fund, a subsidy for setting up infrastructure in unprofitable rural areas, most of the mobile operators have started expanding services to such areas.