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Government of India
Ministry of Communications & Information Technology
Department of Telecommunications
Office of the Administrator, USOF
1. Policy,
Acts and Rules on USO Fund
1.1 The Universal Service Support Policy came into
effect from 01.04.2002. The guidelines for universal
service support policy were issued by DoT and were placed
on the DoT website
www.dot.gov.in
on 27th March 2002. Subsequently, the Indian
Telegraph (Amendment) Act, 2003 giving statutory status to
the Universal Service Obligation Fund (USOF) was passed in
December 2003. The Fund is to be utilized exclusively for
meeting the Universal Service Obligation by providing
access to telegraph services to people in the rural and
remote areas at affordable and reasonable prices.
The USO
Fund was established with the fundamental objective
of providing access to ‘basic’ telegraph services.
Subsequently, an Act has been passed on 29.12.2006 as the
Indian Telegraph (Amendment) Act 2006 to amend the Indian
Telegraph Act, 1885 to enable provision of all types of
telegraph services.
1.2 The Rules for administration of the Fund known as
Indian Telegraph (Amendment) Rules were originally
notified on 26.03.2004. The Rules were subsequently
amended in order to enable support for mobile services and
broadband connectivity in rural and remote areas of the
country as Indian Telegraph (Amendment) Rules 2006 and the
same were published on 17.11.2006. The Rules have
recently been amended to provide subsidy support to
eligible operators for operational sustainability of Rural
Wireline Household DELs installed prior to 01.04.2002, for
a period of 3 years subject to a ceiling of Rs. 2000 Crore
per annum for the country. The Indian Telegraph
(Amendment) Rules 2008 have been published on 18.07.2008.
1.3 The resources for implementation of USO are
raised through a Universal Service Levy (USL) which has
presently been fixed at 5% of the Adjusted Gross Revenue (AGR)
of all Telecom Service Providers except the pure value
added service providers like Internet, Voice Mail, E-Mail
service providers etc. In addition, the Central Govt. may
also give grants and loans.
The annual revenue share licence fee shall be reduced to
the extent of reduction in contribution towards Universal
Service Obligation Fund (USOF) levy if the licensee in
service area(s) meets the prescribed qualification. The
balance to the credit of the Fund will not lapse at the
end of the financial year. Credits to the Fund shall be
through Parliamentary approvals.
1.4 The implementation of USO related activities is
carried out by the “eligible operators” as per the
aforesaid Indian Telegraph (Amendment) Rules covering
Basic Service Operators, Cellular Mobile Service
Providers, Unified Access Services Licensees and
Infrastructure Providers (IP-I). These Telecom Service
providers are both public and private sector companies.
2.0
Activities supported by USO Fund
As per
the Rules, the following services shall be supported by
the Fund, namely:-
(i) Stream-I: Provision of Public Telecom and
Information Services
(a) Operation and Maintenance of Village Public
Telephone in the revenue villages identified as per Census
1991 and Installation of Village Public Telephone in the
additional revenue villages as per Census 2001.- For
installation of Village Public Telephone in the revenue
villages, identified as per 1991 Census, only the
Operating Expenses and Revenue shall be taken into account
for determining the Net Cost. For the additional revenue
villages identified as per 2001 Census, Capital Recovery
in addition shall also be taken into account
for determining the Net Cost.
Provided that in the case of the Village Public Telephone
which are still to be installed in the villages identified
as per Census 1991, Capital Recovery shall also be taken
into account while determining the Net Cost.
(b)
Provision of additional rural community phones in
areas after achieving the target of one Village Public
Telephone in every revenue
village.-
Where in a village the population is more than 2000 and no
public call office is existing, a second public phone
shall be installed and for the purposes of determining the
Net Cost, Capital Recovery, Operating Expenses and Revenue
shall be taken into account.
(c)
Replacement of Multi Access Radio Relay Technology
Village Public Telephone installed before 1st
day of April 2002.-
Capital Recovery, Operating Expenses and Revenue shall be
taken into account for determining the Net Cost.
Note - Unless
otherwise specified by the Central Government, the
Secondary Switching Area shall be taken as a unit for the
purpose of arriving at the Net Cost for activities
specified in items (a) to (e) of stream I.
(ii)
Stream-II – Provision of household telephones in
rural and remote areas as may be determined by the Central
Government from time to time:
(a)
For household Direct Exchange Lines installed prior to 1st
day of April, 2002, the difference in rental actually
charged from rural subscribers and rent prescribed by
Telecom Regulatory Authority of India for such subscribers
shall be reimbursed until such time the Access Deficit
Charges prescribed by Telecom Regulatory Authority of
India from time to time take into account such difference.
(aa)
For Household Direct Exchange Lines installed prior to 1st
day of April 2002, an amount of maximum Two Thousand Crore
rupees per annum for a period of three years shall be
reimbursed to the eligible operators, from the date the
Indian Telegraph (Amendment) Rules, 2008 come into force,
for operational sustainability of rural wirelines in lieu
of Access Deficit Charges being phased out.
(b)
For household Direct Exchange Lines installed after 1st
day of April, 2002, Capital Recovery, Operational Expenses
and Revenue shall be taken into account to determine the
Net Cost.
Note -
Unless otherwise specified by the Central Government, the
Short Distance Charging Area shall be taken as a unit for
the purpose of arriving at the Net Cost for activities
specified in item (b) of Stream II.
(iii)
Stream-III: Creation of infrastructure for
provision of
Mobile
Services in rural and remote areas:
(a)
The assets constituting the infrastructure for provision
of mobile services shall be determined by the Central
Government from time-to-time.
(b)
A percentage of the Capital Recovery for the
infrastructure for provision of mobile services shall be
taken into account to determine the Net Cost.
(iv)
Stream-IV: Provision of Broadband connectivity
to villages in a phased manner
A
percentage of the Capital Recovery for the infrastructure
for broadband connectivity shall be taken into account to
determine the Net Cost.
(v)
Stream-V : Creation of general infrastructure in
rural and remote areas for development of
telecommunication facilities
(a)
The
items of general infrastructure to be taken up for
development shall be determined by the Central Government
from time to time.
(b)
A
percentage of the Capital Recovery for the development of
general infrastructure shall be taken into account to
determine the Net Cost.
Note - Unless otherwise specified by the
Central Government, the revenue district/ group of revenue
districts shall be taken as a unit for the purpose of
arriving at the Net Cost for the activities specified in
Streams III, IV & V.
(vi) Stream-VI: Induction of new technological
developments in the telecom sector in rural and remote
areas
Pilot
projects to establish new technological developments in
the telecom sector, which can be deployed in the rural and
remote area, may be supported with the approval of the
Central Government.
Implementation Status
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