Telcos raise concerns over use of Digital Bharat Nidhi

Telecom operators have opposed the use of Digital Bharat Nidhi (DBN) funds for research and development (R&D) purposes, particularly by public sector units and select institutions like the Indian Institutes of Technology (IITs). According to the telcos, the move goes against the reasons why the corpus was created in the first place.

 In a letter to telecom secretary Neeraj Mittal, telcos stressed that the foundational purpose of DBN was to support deployment of telecom networks in uncovered rural and remote areas.

The Digital Bharat Nidhi (DBN), formerly known as the Universal Service Obligation Fund, is a government-administered pool aimed at financing telecom infrastructure in underserved rural and remote areas. The fund is maintained through a 5 per cent levy on adjusted gross revenue (AGR) from telecom and internet service providers (ISPs). As of December 2023, the DBN corpus stood at ₹86,356 crores.

 Telecom operators have flagged concerns over the government’s move to allocate 5 percent of the DBN corpus to research and development (R&D). The argument of the telecom companies is that the contributor base remains limited to telcos and ISPs, while over-the-top (OTT) platforms, key beneficiaries of broadband expansion, are excluded from making contributions.

Operators also criticised the non-transparent allocation process, pointing out that most of the DBN’s R&D funds have gone to a handful of institutions like the IITs without open or competitive bidding. They stressed that these premier institutions make up a small fraction of India’s engineering education ecosystem and already receive significant public funding, reportedly around ₹8,000 crore in FY22.