After months of anticipation, India finally rolled out the red carpet for the Elon Musk-owned American telecommunications giant Starlink on Tuesday. In a surprising move, Starlink will enter India in partnership with the country’s two biggest players in the sector: Bharti Airtel and Reliance Jio.
In the months leading up to the deals, both Indian firms had expressed alarm over Musk’s entry into the Indian market.
In an interview with Moneycontrol in February, Bharti Airtel chairman Sunil Mittal had said that Starlink was a “formidable competitor”. Earlier in October, Jio had argued that "[a]ny preferential treatment of satellite-based services” should be “firmly rejected”.
The competition between the three telecom giants is driven by the massive size of the Indian telecom market. India has a total of 94.5 crore broadband internet subscribers and 118.9 crore telephone subscribers, according to the Telecom Regulatory Authority of India. This large market is now effectively a duopoly given that Jio and Airtel jointly control over 81% of India’s market for wired and wireless broadband services, according to the latest available regulator data.
Foes turned friends
Jio and Aitel’s anxieties over Musk’s entry are not unjustified. Starlink has disrupted markets by offering cheaper internet than local providers, like in Africa.
Mukesh Ambani-led Jio Platforms saw Starlink as a major challenger. Over the last two years, it sparred with the American firm over how the government should allocate satellite spectrum to internet service providers.
With 40% market share among India’s internet users, Jio is the most dominant player in the country’s mobile internet space, which uses terrestrial spectrum that is auctioned by the Indian government.
Starlink instead uses satellite spectrum to offer internet services. In June 2023, Jio used Starlink as an example and argued that since the satellite internet operators would now compete with terrestrial internet operators, they should acquire spectrum the same way: auctions. It would ensure a “balanced competitive landscape amongst competing providers”, it said.
Jio held this line till late last year, despite the Modi government scrapping auctions and formalising the administrative allocation of satellite spectrum through the Telecommunications Act 2023.
The auction question
On the face of it, Airtel has aligned with Starlink on the matter and supported the administrative allocation since April 2023. It argued, like Musk, that satellite spectrum cannot be auctioned because it is a “shared resource”.
But this congruence does not mean that the two firms are on the same side. In fact, Airtel’s 33% market share in India is largely built on its terrestrial internet services, and so it faces the same threat from Starlink as Jio does.
It’s no surprise then that in late 2024, as Musk’s firm entering India became imminent, Airtel’s position came to overlap with Jio’s.
At an event in October 2024, with Prime Minister Narendra Modi in the audience, Mittal said that satellite companies eyeing the Indian market “need to buy spectrum like the telecom companies do, and pay the same license fees” – a statement widely interpreted as supporting auctions.
The next day, Airtel had to clarify that it still wanted administrative allocation of satellite spectrum. But in November 2024, it continued to use the same talking points as Jio on the entry of new players in the Indian market, insisting on “healthy competition” and “level playing field” in the emerging satellite internet sector.
The Musk-Trump factor
The two Indian firms have not explained how their opposition to Starlink turned into a partnership. Rest of the World speculated that Narendra Modi’s trip to the United States in February had a role to play in it. The Indian prime minister had met Musk in Washington DC, tweeting that they discussed “space, mobility, technology and innovation”. Later, with Modi alongside him at the White House, US President Donald Trump said he assumed the meeting took place since Musk wants to “do business in India”.
This major victory for the US company comes amidst several attacks from Trump on India’s high import duties. Trump, whose presidential campaign in 2024 was heavily funded by Musk, has repeatedly criticised India for using high rates of tariff, also known as duties in India, to restrict US companies’ access to its market.
On Thursday, the Congress party linked the two, claiming that appeasing Musk was a way to “buy peace” with the US president amid the tariff wars. “It is abundantly clear that these partnerships have been orchestrated by none other than the PM himself to buy goodwill with President Trump through Starlink's owner Mr. Elon Musk,” Congress leader Jairam Ramesh tweeted.
Musk is seen as close to Trump and since the new administration took over in Washington, Musk’s frequent interactions with foreign heads of state, often alongside Trump, have drawn international attention. Trump has also asked Musk, who is the world’s richest man according to the Forbes real-time billionaires list, to lead the newly created Department of Government Efficiency and advise him on modernising the US federal government.
Tesla link
This is not the first time India has made changes that are seen as benefitting Musk. Even before the January change of government in the US, India had slashed the import duty for ready-to-sell electric vehicles from the previous range of 70%-100% to 15% provided the carmaker agreed to manufacture in India within three years of entering the market. The March 2024 decision was seen by many as paving the way for Musk’s electric vehicles company Tesla to sell in India.
Musk then wrote a post on Twitter, which he acquired in 2022 and rebranded as X a year later, announcing his India visit in the middle of the country’s 2024 general election, only to cancel it later citing “very heavy Tesla obligations”. The supposed Indian launch of Musk’s many businesses has since then been a recurring subject of speculation on social and news media in India.
On Thursday, the Congress also bought up Tesla. “And, of course, the much larger question of Tesla manufacturing in India remains,” Ramesh tweeted. “Is there some commitment to it now that Starlink's entry into India has been facilitated?”
