Govt to amend USO fund rules soon

The government will soon amend the Universal Service Obligation (USO) Fund rules to make it easier for telecom companies to access over Rs 16,000-crore corpus lying with the Centre to push rural telephony.

"It (amendment) is being done to remove the rigidity in USO Fund rules and make it more flexible," Communications and IT minister A Raja said during a curtain raiser of India Telecom 2009, organised by industry association Ficci here.

He added that the new rules will give telcos quick access to the fund and help in increasing rural teledensity.

Over Rs 16,000 crore of USO funds lie unused with the Consolidated Fund of India because the rules governing the release of the fund are too rigid. The USO Fund was initially established with the fundamental objective of providing access to basic telegraph services in the rural and remote areas.

Subsequently, an Act was passed in 2006 — the Indian Telegraph (Amendment) Act 2006 — to amend the Indian Telegraph Act of 1885, to enable provision of all types of telegraph services.

The rules were subsequently amended in order to enable support for mobile services and broadband connectivity in rural and remote areas as the Indian Telegraph (Amendment) Rules 2006.

The telecom service providers are both public and private sector companies.