India plans to amend rules to push rural telephony

Telecom minister A Raja said on Wednesday he is planning to amend the Universal Service Obligation Fund rules in the next two months to make it easier for telcos to access over Rs 11,000 crore (Rs 110 billion) corpus lying with the government to push rural telephony.

"It (amendment) is being done to remove the rigidity in USO fund rules and make it more flexible," Raja told reporters at ITU event held in Geneva.

He added that the new rules would do away with the tender system for allotting funds to operators, including the private telecom service providers.

Currently, USO fund administrator invites bid from interested telcos for setting up infrastructure in rural areas and the process is time consuming.

Over Rs 11,000 crore of USO Fund lie unutilised with the Consolidated Fund of India because the rules governing the release of the fund are too rigid.

The USO Fund was initially established with the fundamental objective of providing access to basic telegraph services in the rural and remote areas at affordable and reasonable prices.

Subsequently, an Act was passed in 2006 -- the Indian Telegraph (Amendment) Act 2006 -- to amend the Indian Telegraph Act, 1885 to enable provision of all types of telegraph services.

The rules were subsequently amended in order to enable support for mobile services and broadband connectivity in rural and remote areas as the Indian Telegraph (Amendment) Rules 2006.

The telecom service providers are both public and private sector companies.

The resources for implementation of USO are raised through a Universal Service Levy, which, at present, is fixed at 5 per cent of the Adjusted Gross Revenue of all telecom service providers.

Image: Telecom minister A Raja