The Universal Service Obligation Fund (USOF) has the responsibility of taking mobile connectivity to the unconnected. But it seems USOF believes in furthering the interests of corporate sector first and is least bothered with the welfare and development of regions deprived of proper mobile connectivity. It is high time to scrap USOF which has failed miserably to live up to its mission of serving the deprived regions of the country.

We present to you yet another case of gross apathy of USOF while dealing with the Northeast mobile connectivity project. This time it is Meghalaya state which has to have mobile towers funded by USOF. Yet again USOF dilly dallying tactics has stalled implementation of the project. Moreover, the entire modus operandi of USOF in dealing with Meghalaya reeks of favourtism. USOF is not only neglecting state-run BSNL but also openly violating laid government guidelines by going ahead with important financial decisions without any feasibility study or proper evaluation. Moreover, it is taking dubious decisions despite clear instructions from the PMO…

In 2014 the Union Cabinet approved the proposal to implement a comprehensive telecom development plan for the North-Eastern region covering eight states with an estimate of Rs.5,336 crores with funds coming from USOF. Cabinet approved 2G coverage for uncovered areas of Assam and Arunanchal Pradesh to be given to BSNL while other states, including Meghalaya, were to be connected through a tender process by USOF.

It took USOF three years to complete its tender process which ironically had just one bidder — Bharti Airtel. But later Meghalaya tender comprising 2,173 towers was cancelled as USOF found that tender rates were 70% higher (Rs.2,351 crore instead of Rs.1,374 crore as estimated total outgo). USOF suggested re-tendering with technology upgradation, from 2G plus Edge to 2G puls 4G, and increased it costs to Rs.4,302 crores without conducting any financial viability of the project.

This development led to severe criticism from the PMO with Principal Secretary to PM writingeven after the delay in finalisation of tender, the works in Meghalaya have not been awarded as yet. Noting that the process of bidding would further delay the project, the proposal for awarding the project to BSNL on cast plus basis should be examined“.

But this too was conveniently ignored by USOF despite the fact that BSNL has been instrumental in completing mobile tower project in Naxalism-affected states which is considered one of toughest task in the telecom sector and where no private player dared to venture. Moreover, BSNL is currently implementing mobile tower project in Assam and Arunachal Pradesh after undergoing a successful tender process. It was on this basis that the PMO had suggested BSNL’s name. But the top echelons of DoT led by USOF ganged up to disallow BSNL a chance to participate in the project.

Surprisingly, DoT and USOF decided to change the technology part from 2G plus Edge as implemented in entire Northeast to 2G plus 4G just for Meghalaya without taking consent from Union Cabinet. It increased the cost of project for Meghalaya to a whopping Rs.4,302 crores without going for any financial viability, technical studies and ROI (return of investment) studies.

The way USOF is implementing the ambitious project, Meghalaya project is also a major setback for Prime Minister’s ‘Make In India’ initiative. BSNL is bound to implement preferential market access (PMA) policy allowing only domestic equipment manufacturer to bid in its project, but private operators are not bound by PMA. In Northeast, which shares crucial borders with China, foreign players including Chinese telecom equipment-makers are being allowed to put up their equipment in gross negligence of national security interests.

Now there are several questions which USOF and DoT need to answer before going ahead with Meghalaya project…

  1. Was any financial viability study conducted before voluntarily deciding 2G plus 4G technology for Meghalaya? Whether it is financially prudent to invest Rs.4,302 crores in Meghalaya alone when other regions of the Northeast and remote locations of India await technology upgradation for mobile and broadband services?

  2. Was Union Cabinet kept in loop before Telecom Commission and USOF spent months in making a case for 2G plus 4G technology leading to massive cost escalation and further delay in the project?

  3. Why such a huge amount be given to a private operator for setting up tower network which it will use to its advantage? Why was BSNL, being a government-run company and which is struggling financially, deprived the first right to use public funds? 

  4. Why other seven states not given same treatment of getting 2G plus 4G technology? Why other people of North-eastern states deprived of advanced technology?

  5. Why BSNL not given a chance to upgrade its technology? Will it not weaken BSNL and deprive its customers of better services?

  6. What happens to Prime Minister’s ‘Make In India’ initiative? Why PMA guidelines just for BSNL and why private players are kept out of it?

  7. Is it not comprising national security by allowing foreign players to put up telecom gear in the Northeast which shares border with China?

  8. USOF allowed single bid in Northeast and even awarded tender which is against violation of government guidelines and against the rules of fair competition. When BSNL can attract three Indian bidders for its Northeast project, why USOF allowed just one company? Why did USOF not ask BSNL to take the project to attract more players?

These are some unanswered questions which Telecom Commission and USOF will have to deal with. 

Prime Minister Narendra Modi during his visits to the Northeast have been promising better telecom connectivity for the region before 2019. But this tasks is highly unachievable, thanks to poor planning and gross apathy on part of USOF. It is due to its indecision and absurd decision making that none of the Northeast project is likely to completed on time.

While BSNL is running late in completing its share of the Northeast project as USOF has failed to take timely decisions on tendering process and release money, in other states also the 2019 deadline is unlikely to be met.

The Prime Minister needs to understand, it is not the USOF or the top bureaucrats in the Telecom Commission who have to face the public; but it is the political leadership, it is you the leader of the government who is answerable to the people.

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