National broadband remains a dream deferred

Despite the ballyhoo over the National Telecom Policy, 2.5 lakh villages still won’t get broadband internet access by December 2014, the extended deadline for the grand venture – the Rs20,000 crore national optical fibre network project spanning 5 lakh km.

Financed by the Universal Service Obligation (USO) Fund which focuses on rural broadband connectivity, the project was initially scheduled to finish by December 2012. It comprises individual schemes such as the Wire Line Broadband Scheme, the Rural Public Service Terminal Pilot for Financial Inclusion and the Optical Fibre Cable Network connecting block headquarters known as gram panchayats.

Governmental dithering, confusion over the project structure and the technology to be used and under-utilisation/misuse of the project fund are all to blame, according to stakeholders and telecom industry experts.

For instance, not an inch of new optic fibre cable has been laid so far; so, even the December 2014 deadline is unrealistic, they alleged.

Over the last two years, progress has been made only in setting up new committees to aid in rolling out the project. Earlier this year, the government set up Bharat Broadband Network Limited (BBTL), a special purpose vehicle to implement the project.

Unconfirmed talk is that BBTL might go public in the next ten days. USO Fund’s administrator, Ajay Bhattacharya, is said to head BBTL.

In the first phase, BBTL will launch pilot projects to connect 2.5 lakh gram panchayats with existing optical fibre to be contributed jointly by BSNL, RailTel and Power Grid Corporation (PGC), the three contractors to the project.

Private telecom operators (who contribute 5% of their revenues every month towards the USO Fund) and internet service providers were not included in the first phase.

The USO Fund, it was said, had not budgeted for broadband wireless access to village homes in the first phase, which was to be completed by 2013 but now looks set for an extension. It is only in the second phase that private players will be roped in to roll out broadband for village homes and other users.

Project delays have irked both telecom operators and consumers alike. “Only a few states, not all, have approved the rollout of optical fibre,” said a telecom ministry source who sought anonymity. Only Nagaland, Uttarakhand and Jharkhand have given free access to lay cables. Pilots are planned in Tripura, Visakhapatnam, Ajmer and Goa to test viability of the project.

BSNL which has 6 lakh km long network of optic fibre cables, will contribute substantially to the project, to connect 1.5 lakh gram panchayats. PGC has mandate for 1 lakh km long cables. RailTel and PGC will wire up 50,000 panchayats each by December 2013.

However, the contractors claim only in-principle orders have been given so far. The final award of the contracts is expected in three months. That’s when the amount to be paid to each vendor will be decided. “Panchayat-level obligations will be met by 2014-end. Village-level work will be definitely delayed,” said a company source.

As for technology to be used, WiMax has been found to be the cheapest, but other technologies like C-DOT, GPON, 2G, 3G or 4G are yet to be tested.

“Panchayat-level connectivity is for backhaul,” said Babu Narayanan Koonampilli J, coordinator of the Broadband Wireless Consortium of India. “For villages, optical fibre or microwave technology could be used. But this, and when telecom operators would be included, has not been specified. It will likely take at least five years to roll out broadband at the panchayat level.”

Bejon Misra, founder of the Consumer Online Foundation, pointed out that Rs21,839.45 crore has been collected from telecom operators towards the USO Fund. Every month, 10% of a subscriber’s bill goes towards the USO Fund.

“However, several rural subscribers are suffering because even after getting handsets, they are yet to be provided with telecom services. Connectivity is pathetic and call-drops frequent. This has led us to believe that the USO Fund is being utilised only to bail out state-owned telecom companies such as BSNL, which was given a Rs2,000 crore subsidy each year from the USO Fund for its rural landline operations till September 2011. Moreover, there has been no consultation with consumer forums or private operators.” A public-private partnership would be better and transparent, Misra said.

The officials concerned at both the telecom department and the USO Fund were not available for comment. The government, it appears, is caught up in its own style of functioning. Last week, it constituted a coordination committee (under the chairmanship of telecom secretary R Chandrasekar and with the USO Fund administrator as the convenor), to assess the need for government-to-citizen (G2C) services down to the panchayat level.

The Union cabinet will now decide on fund utilisation and final rollout, a government source said. Since the cabinet is already tasked to decide the 2G spectrum price, the cost of spectrum licence renewal for incumbent operators and spectrum refarming, the rural Wi-Fi dream may come true later than sooner.