The first rules of the new Telecom Act 2023 are now in effect in India. The Department of Telecommunications (DoT) shared the development in a post on social media platform X. DoT said that the first rules of the Telecom Act 2023, 'Digital Bharat Nidhi' is now in effect on September 1, 2024. The thing to note here is that Digital Bharat Nidhi is nothing but the rebranded USOF (Universal Service Obligation Fund). Under the USOF, funds are collected by the central government so that they can be used to promote digital connectivity throughout India.
Read More - Jio in Competition with Google and Apple with Latest Cloud Offering
The telecom operators in the country pay for this fund. The 8% license fee that the telcos pay includes a 5% USOF contribution and 3% towards the actual license fee contribution. The telcos have time and again requested the government to pause the collection of USOF so that their quarterly and yearly outgo of cash gets relief. According to the telcos, till the time the funds in the USOF are utilised, its collection can be paused so that the cash-strapped telcos can see better returns in the short term.
Read More - BSNL Upgrades Speed Benefits for Entry-Level Broadband Plans
However, the government doesn't want to do that as of now. The new rules from the Telecom Act 2023 have outlined the roles and responsibilities of the Digital Bharat Nidhi administrator. The admin will oversee the fund's implementation in the correct manner. The key objective of the DBN remains the same as that of the USOF - to promote indigenous tech development and encourage telecom start-ups. DBN will also be used to fund the rollout of networks in backward areas to eliminate the digital divide in the country.
Telecom players like BSNL (Bharat Sanchar Nigam Limited) have already utilised USOF in the past to offer network connectivity in rural or remote regions of the country.
