The share of the revenue private telecom operators pay the Centre for the Universal Service Obligation Fund (USOF) is likely to fall from the current five per cent. The USOF is aimed at boosting telecom connectivity in rural areas.
The Department of Telecommunications (DoT) is working on a plan to restructure the USOF. A DoT official said a detailed one had been prepared and a final decision would be taken in four to six weeks. This follows operators and industry body Cellular Operators Association of India (COAI) repeatedly asking the Centre to reduce the USOF payment to one per cent of the revenue of telecom operators.
Universal service obligation payments are much lower in other countries, including some with lower mobile penetration. For instance, the payment stands at two per cent in Colombia and Pakistan, one per cent in Brazil and 0.8 per cent in Canada. On the other hand, the level of utilisation of the fund is much higher in other countries. According to the DoT data, India has used 30 per cent of the USOF it has collected since the fund was set up in 2002-03. For some countries, utilisation stands at about 80 per cent. According to global cellular industry body GSMA, USOF utilisation in Colombia stood at 84 per cent in 2011.
Telecom firms may soon pay less for universal service obligation | Business Standard News