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Universal Service Obligation Fund

Focus: GS II- Government Policies and Interventions

Why in News?

Department of Telecommunications signs agreement with ITI Limited and BSNL to fund pilot projects under Universal Service Obligation Fund (USOF)

What is the Universal Service Obligation Fund (USOF)?

  • The Universal Service Obligation Fund (USOF) was established with the primary objective of providing access to ‘Basic’ telecom services to people in the remote and rural areas at reasonable and affordable prices.
  • USOF ensures that there is universal non-discriminatory access to quality ICT (Information and Communications Technology) services at economically efficient prices to people in rural and remote areas.
  • It was created under the Ministry of Communications in 2002.
  • It is a non-lapsable fund, i.e., the unspent amount under a targeted financial year does not lapse and is accrued for next years’ spending.
  • All credits to this fund require parliamentary approval and it has statutory support under Indian Telegraph (Amendment) Act, 2003.
  • Universal Service stands for universal, interdependent and intercommunicating, affording the opportunity for any subscriber to any exchange to communicate with any other subscriber of any other exchange.
  • Subsequently, the scope was widened to provide subsidy support for enabling access to all types of telegraph services including mobile services, broadband connectivity, and creation of infrastructure like Optical Fiber Cable (OFC) in rural and remote areas.
  • With access to affordable telecom services in remote and rural areas, the USOF is the right step towards stemming urban migration. This would ensure to generate employment opportunities in the rural areas which would help generate more income.

The USOF proposes to meet its social, economic, political and constitutional objectives which are as follows:

  • To extend the telecommunication network.
  • To stimulate the uptake of Internet and Communication Technologies (ICT) services.
  • To bring the underserved and unserved areas of the country into the telecom spectrum and narrow down the access gap.
  • To use the pooled USO levy for an equitable distribution through target subsidies.
Who are the partners of USOF?

As per the Department of Telecommunications, there are 24 partners of USOF. It includes:

  • Bharat Sanchar Nigam Limited
  • Tata Tele Services Limited
  • Reliance Communications Limited
  • Vodafone
  • Bharti Airtel Limited, etc

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