Mobile connectivity under Universal Service Obligation Fund(USOF)

In news

The Union Cabinet has given its approval for provision of a Universal Service Obligation Fund (USOF) Scheme for providing mobile connectivity in some of the villages of North Eastern states

Key highlights

It will cover 6000 villages of Arunachal Pradesh, Meghalaya and other parts of North Eastern States to bring these regions to the mainstream.
The USOF scheme has been approved under the Comprehensive Telecom Development Plan (CTDP) for North Eastern Region (NER).
The project would be funded by Universal Service Obligation Fund.
The project is targeted to be completed by December, 2022.
The work related to provision of 4G mobile services in identified uncovered villages will be awarded through open competitive bidding process as per extant USOF procedures.
Under the Comprehensive Telecom Development Plan for North Eastern Region, the Department is executing a project to install of 2004 towers to cover 2128 villages and National Highways. More than 1,300 towers are now radiating

About the Universal Service Obligation Fund (USOF)

The genesis of the term

In 1837, concept originated by Rowland Hill with his postal reforms, which included uniform rates across United Kingdom and prepayment by sender via postage stamps. Universal Service is a key objective of the Universal Postal Union.

History of USOF

The New Telecom Policy (NTP) 1999 of Department of Telecom, GoI had Universal Service as one of its main objectives, as reproduced below –
Strive to provide a balance between the provision of Universal Service to all uncovered areas, including the rural areas,
the provision of high-level services capable of meeting the needs of the country’s economy and
encourage development of telecommunication facilities in remote, hilly and tribal areas of the country
The NTP 1999 provided that the resources for meeting the Universal Service Obligation (USO) were to be generated through a Universal Access Levy (UAL), at a prescribed percentage of the revenue earned by the telecom licensees to be decided in consultation with the Telecom Regulatory Authority of India (TRAI).
Further, NTP 1999 envisaged the implementation of USO Obligation for rural and remote areas would be undertaken by all fixed service providers who shall be reimbursed from the USOF.
The Universal Service Support Policy came into effect from 01.04.2002. The guidelines for universal service support policy were issued by DoT on 27th March 2002.
The Indian Telegraph (Amendment) Act, 2003 giving statutory status to the Universal Service Obligation Fund (USOF) was passed by both Houses of Parliament in December 2003.
As per the Indian Telegraph Act 1885 (as amended in 2003, 2006), the Fund is to be utilized exclusively for meeting the Universal Service Obligation.

Vision

Enabling rural Indians to achieve their fullest potential and participate productively in the development of the nation by virtue of being effectively connected through a reliable and ubiquitous telecommunications network, access to which is within their reach and within their means.

Objectives of USOF

Economic: Network extension & stimulate uptake of the ICT services
Social: Mainstreaming the underserved & un-served areas/groups by bridging the ‘ï¿½ï¿½Access Gap’ï¿½ï¿½
Political: to enable citizens exercise their political rights in an informed way and
Constitutional: Equitable distribution of the fruits of the telecom/digital revolution and fair allocation of national resource (pooled USO levy) via targeted subsidies

Functions of USOF

Implementation of the guidelines laid down by Government for providing Universal Service Support
Suggesting such changes in policy as may be deemed necessary for implementation of Universal Service Support
Formulating USOF projects/schemes under the various streams provided in the Indian Telegraph Rules, 1951, in consultation with telecom service providers and various stakeholders
Designing an intelligent subsidy support model underlying the scheme/project, for reducing/closing the Viability Gap in provisioning of telecommunication service
Determining desirable subsidy level, structure & disbursement schedule after undertaking a suitable costing & modeling/benchmarking exercise and competitive tendering process
Designing the bidding process and carry out the tendering
Entering into aptly drafted Agreements with the Universal Service Providers (USPs) with incentives & disincentives to ensure the achievement of the deliverables
Monitoring the implementation of USOF projects/schemes and to disburse subsidy in accordance with the terms & conditions of the respective USOF Agreement
Accurate & timely settlement of all claims of subsidy/financial support in respect of USOF schemes
Designing the format of various records and return to be maintained by the USPs
Carrying out post-implementation review of USOF projects/schemes
Budgeting and Audit of USOF activities
Interfacing with international organizations such as ITU, APT and USO funds of other nations
Forecasting the requirement of Universal Service Funds for each financial year and obtaining approval of Government through Department of Telecom
Ensuring that the prescribed Universal Service Levy is credited to the appropriate Universal Service Fund on a regular basis.