Budget 2022: Auctions By March, Rollout By FY23 Govt lays ground for 5G rollout; pushes rural broadband deadline to 2025

“Telecommunication in general, and 5G technology in particular, can enable growth and offer job opportunities. Required spectrum auctions will be conducted in 2022 to facilitate rollout of 5G mobile services within 2022-23 by private telecom providers,” Finance Minister Nirmala Sitharaman said in her Budget speech on Tuesday.

Further, 5 per cent of the annual collection from the universal service obligation fund (USOF) would be allocated to enable broadband and mobile service proliferation in rural areas, she said. Of the 8 per cent adjusted gross revenue payable by private telecom service providers and other telecom licence holders, 5 per cent goes into the USOF, while the rest goes into the central exchequer. Currently, the USOF kitty has more than Rs 60,000 crore.

Contracts for laying optical fibre in all villages, including those in remote areas, will be awarded in the next fiscal. The government aims to complete the project in public-private partnership (PPP) mode, planning to spend Rs 19,041 crore as viability gap funding. Overall, the government plans to spend Rs 29,432 crore to implement the project.

Under the PPP model, a concessionaire will be selected through a competitive international bidding process and will be responsible for creation, upgradation, operation, maintenance and utilisation of BharatNet. The revised strategy will be followed in 16 states for now.

The government, however, also pushed the deadline for completion of BharatNet by close to two years to 2025.

The initial aim of BharatNet, which was started as NOFN, was to connect 2.5 lakh gram panchayats (GPs) with high speed broadband internet by 2014. The initial phase one was supposed to connect 1.5 lakh GPs, while phase two was supposed to connect the remaining 1 lakh GPs. In 2020, the scope of the scheme was expanded when Prime Minister Narendra Modi announced on August 15 that over the next 1,000 days, BharatNet would connect all six lakh villages through high-speed internet.

On Tuesday, telecom minister Ashwini Vaishaw also said that the auctions for 5G would be held in 2022, as the Telecom Regulatory Authority of India recommendation on the technology and its auction is likely to come by March.

Vaishnaw also said that the Department of Telecommunications was working parallely on other auction-related aspects to expedite the entire process.

The budget for 2022-23 also announced a fund infusion of Rs 44,720 crore in Bharat Sanchar Nigam Limited for the next fiscal, while additional financial support of Rs 7,443.57 would be provided to a state-run telecom service provider to clear the voluntary retirement scheme dues.