The Department of Telecommunication released draft rules on Thursday prescribing how the Digital Bharat Nidhi (DBN) -- which replaced the Universal Service Obligation Fund -- will be administered for a 30-day public consultation.
The DBN was established through the Telecommunications Act, 2023, passed by Parliament and received presidential assent in December. The USOF was established to provide telecom services in remote and rural areas at affordable prices through a universal access levy, a percentage of revenue earned by operators under various licences.
Sections 24 to 26 of the act, which renamed the USOF as DBN and defined its funding, came into effect on June 26.
Under section 25, payments received for DBN will first be credited to the Consolidated Fund of India. They will then be credited to the DBN by the central government (on parliamentary approval through a law) exclusively to provide access to telecommunication services in underserved rural, remote and urban areas; support pilot projects and consultancy assistance; support research and development; or support introduction of new telecom services, technologies and products.
The proposed rules aim to replace rules 523 to 527 of the Indian Telegraph Rules, 1951, which prescribed USOF operations. However, the new rules will not override existing arrangements until their expiry. USOF was given statutory status in December 2003 through amendments to the Indian Telegraph Act (now replaced by the Telecom Act, 2023).
{{/usCountry}}The proposed rules aim to replace rules 523 to 527 of the Indian Telegraph Rules, 1951, which prescribed USOF operations. However, the new rules will not override existing arrangements until their expiry. USOF was given statutory status in December 2003 through amendments to the Indian Telegraph Act (now replaced by the Telecom Act, 2023).
{{/usCountry}}The new rules remove definitions of financial terms such as “capital recovery”, “net cost” and “revenue”. They also omit definitions of technical terms like “village public telephone”, “secondary switching area” and “broadband connectivity”.
Under the proposed rules, the central government will appoint an “administrator” of the DBN who will select “DBN implementers” through “bidding” or invitation of applications from eligible persons.
The rules stipulate that DBN implementers, on receiving funding, must offer services to underserved areas in “an open and non-discriminatory” manner, complying with instructions from the DBN administrator.
To improve access to established telecom services in underserved areas, DBN implementers will be selected through bidding, as per rule 7, similar to USOF rules. In a new provision, implementers will be selected through application for research and development of new or emerging telecom technologies.
The administrator will have power to formulate bidding and application procedures, disburse funds, and specify terms related to assets created through DBN funds.