In CDMA, we did not have legacy carriers, a second hand market of handsets, or even people understanding the technology
The Universal Service Obligation fund was set up in April 2002 and a statutory status was given to it.
Billionaire Mukesh Ambani on Wednesday pitched for using the USO Fund to subsidise smartphones for select groups to help penetrate the digital revolution and said India should make the rollout of 5G or the fifth-generation technology standard for broadband cellular networks a national priority. As much as 5 per cent of the licence fee paid by telecom operators goes to the Universal Service Obligation (USO) Fund, which was set up in April 2002 for achieving universal service objectives by providing access to telephone services in rural and remote areas and creation of infrastructure for mobile services and broadband in these areas. However, according to the CAG, less than half of the funds so collected are transferred for the said purpose.
Telecom Minister Ravi Shankar Prasad is learnt to have approached Finance Minister Arun Jaitley for additional funds to carry out schemes committed under Universal Services Obligation fund scheme.
Currently, USO fund administrator invites bid from interested telcos for setting up infrastructure in rural areas and the process is time consuming.
The government said on Wednesday that the Telegraph Act would be amended to incorporate cellular service providers to get a share from the Universal Service Obligation Fund to connect all villages, highways and rail network.\n\n
Telecom Minister Kapil Sibal tried to put up a brave front over the allegations levelled against him of causing loss to the government by favouring an Anil Ambani-led company.
The Union Cabinet on Thursday approved the amendment of the Telegraph Act giving statutory status to the Universal Service Obligation Fund.
It will escalate costs, mandate regulator to check malpractices, set standards.
Being the only universal service provider in uneconomic areas, the state-owned Bharat Sanchar Nigam Ltd has sought exemption from contributing to the dedicated fund saying it should be reimbursed directly on the basis of cost incurred.
Defending the continuation of Universal Service Obligation support, a fund to subsidise unprofitable operations of otherwise profit making telecom PSUs like BSNL, the government on Tuesday said USO exists for all players and not for BSNL alone.
For the PMO this is urgent as the Digital India framework would depend on how the telecom companies perform. It is also linked to the proposed auction of 5G airwaves.
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