Telecom department unveils new rules for Digital Bharat Nidhi
- In Reports
- 10:20 PM, Aug 31, 2024
- Myind Staff
On Saturday, the Department of Telecommunications issued and implemented the initial set of regulations under the Telecommunication Act, 2023. These new rules outline the operation of the Digital Bharat Nidhi (DBN), which succeeds the Universal Service Obligation Fund (USOF).
The Digital Bharat Nidhi (DBN) was created by the Telecommunications Act, 2023, which was approved by Parliament and received the President’s assent in December. The previous Universal Service Obligation Fund (USOF) aimed to deliver telecom services to remote and rural areas at affordable rates through a universal access levy, which was a percentage of revenue earned by operators under various licenses.
The draft rules were made available for a 30-day public consultation starting July 4. The final notified rules closely mirror the draft, with only minor language adjustments. Sections 24 to 26 of the Act, which rebranded the USOF as the DBN and outlined its funding mechanisms, took effect on June 26.
The new rules replace rules 523 to 527 of the Indian Telegraph Rules, 1951, which detailed the operation of the USOF. However, the new regulations will not override the existing arrangements until they expire. The USOF was granted statutory status in December 2003 through amendments to the Indian Telegraph Act, which has since been replaced by the Telecom Act, 2023.
Under Section 25, payments made to the Digital Bharat Nidhi (DBN) will initially be deposited into the Consolidated Fund of India. The central government, with Parliamentary approval through legislation, will then transfer these funds to the DBN. The funds will be used exclusively for expanding telecommunication services in underserved rural, remote, and urban areas; supporting pilot projects and consultancy services for these areas; advancing research and development in telecommunications; or facilitating the introduction of new telecom services, technologies, and products.
Under the new rules, the central government will designate an “administrator” for the Digital Bharat Nidhi (DBN) via a gazette notification. The administrator will then appoint “DBN implementers”—individuals or entities with whom the administrator enters into agreements—either through a bidding process or by inviting applications.
To provide telecom services in underserved rural, remote, and urban areas, implementers will be selected through a bidding process. For research and development of new telecom technologies, products, or services, selection will be based on a call for proposals or expressions of interest, which will define technical parameters. However, the rules also allow the administrator to nominate an implementer under “special circumstances” with the central government’s approval.
The rules require that any implementer receiving DBN funding offer services to underserved areas in an “open and non-discriminatory” manner and adhere to the instructions issued by the DBN administrator.
Rule 4(3) grants the DBN administrator the authority to decide the “modalities for funding provided by the DBN for schemes and projects” on a case-by-case basis. These modalities may encompass full funding, partial funding, co-funding, market risk mitigation, and risk capital.
The DBN administrator is empowered to establish the procedures for bidding and application processes, including setting eligibility and evaluation criteria. This administrator can also disburse funds from the DBN to implementers and specify the terms and conditions for assets created with these funds.
Additionally, the DBN administrator is required to develop a digital portal to facilitate DBN implementers and other stakeholders in providing services, as well as reporting and monitoring schemes and projects.
Image source: Meity
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