The Study By Manikant Singh
Search

Digital Bharat Nidhi (DNB)

  • 0
  • 3070
Font size:
Print

Digital Bharat Nidhi (DNB)

Context: The Department of Telecommunications (DoT) released draft rules to operationalise the Digital Bharat Nidhi, it would replace the erstwhile Universal Service Obligation Fund (USOF). 

 

Digital Bharat Nidhi

  • It was established through the Telecommunications Act, 2023, passed by Parliament.
  • Goal: Improve and expand efforts to connect people to the Internet, especially in rural, remote, and poor urban areas.

 

  • Objectives:
    • Enhance rural telecom services.
    • Support research and development in telecommunication technologies.
    • Finance pilot projects and consultancy services.
    • Provide targeted access to telecommunication services for underserved groups.
    • Promote innovation, research, and development of indigenous technologies.

 

  • Focus Areas:
    • Target Groups: Women, persons with disabilities, economically and socially weaker sections.
    • Technological Goals: Introduce next-gen telecom technologies, improve affordability, promote innovation, R&D, and indigenous technology.
    • Standards and Startups: Develop national and international standards, encourage telecom sector startups and manufacturing.

 

  • Funding: Contributions from telecom companies will be credited to the Consolidated Fund of India (CFI) and then deposited to the DBN.
  • Funds will be utilised to support universal telecommunication services, research and development, pilot projects, consultancy, and advisory support.
  • Funding will be determined case-by-case, including full, partial, co-funding, market risk mitigation, and risk capital.
  • The government will appoint an administrator to manage it who will select DBN implementers through bidding or invitations for applications from eligible persons.

Consolidated Fund of India (CFI): Article 266 provides for the provisions for the consolidated fund of India.

  • It is an account in which all revenues that the government receives, including loans raised and all money received in repayment of loans, are credited
  • The government also incurs its expenditures from this fund.

 

Impact of Digital Bharat Nidhi 

  • Improving Rural Connectivity: Focus on expanding telecom networks in remote and rural areas where private companies may not find it profitable.
  • Enhancing Competition: Encourages innovation and new businesses in the telecom sector, making it more competitive globally.
  • Addressing Underutilization: Replaces the USOF, which had been criticised for not utilising funds effectively, aiming to improve the efficiency of the new fund.

 

USOF

  • Established in 2003 through an amendment to Indian Telegraph Act of 1885.
  • Funding Source: It was funded by a 5% Universal Service Levy on the Adjusted Gross Revenue (AGR) of telecom operators.
  • Purpose: Intended to fund telecom network expansion in rural and remote areas.
  • Underutilisation of USOF
    • Collection vs. Utilisation: Between 2017 and 2022, Rs 41,740 crore was collected, but only Rs 30,213 crore utilised (72%).
    • Specific Fiscal Data: In 2019-20, out of Rs 7,962 crore collected, only Rs 2,926 crore utilised.
    • BharatNet Project: Underspending on the BharatNet project contributed to overall underutilization.

 

Print
Apply What You've Learned.
Prev Post Revitalising India's Skilling Ecosystem through DGT Initiatives
Next Post India’s Manufacturing Sector & Core Infrastructure