Friday, August 21, 2009

Govt invites bids for rural broadband link

If you need any proof of the government’s commitment to the cause of inclusive growth, this is it. The communications ministry has nvited bids to set up some 28,000 wireline broadband exchanges and 6,000 satellite sites in an effort to boost internet penetration in the country, especially rural India.

The project will be funded from the Universal Service Obligation Fund (USOF), to which all telecom operators contribute 5% of their annual revenues. USOF helps unviable rural telephony projects.

The unutilised amount in the USOF is currently estimated to be over INR 20,000 crore. The last

Union Budget had allocated INR 2,400 crore from the USOF to subsidise unviable mobile, Internet and landline operations in rural India.

Both private and state-owned telcos will be eligible to bid for these 34,000 exchanges, and successful bidders will have to share the infrastructure with other operators for a fee. The subsidy from the USOF will be granted in a phased manner and will be determined by the degree to which the infrastructure is shared.

The satellite-based broadband exchanges will be set up in areas where fibre networks can’t reach on account of inaccessible terrain.

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