USF Malakand Lot Project: Agreement with Telenor may be scrapped

Universal Service Fund to provide subsidy to telecom sector on operational expenses in war-hit areas for three years.

ISLAMABAD:

The Universal Service Fund (USF) board decided on Tuesday that it may terminate the USF Malakand Lot Project agreement with Telenor and reauction the project.

This was decided in a meeting chaired by Prime Minister Yousaf Raza Gilani at the prime minister’s house on Tuesday afternoon.

The project could not be completed due to security reasons and military operations in the districts of Swat, Shangla, Buner Dir among others.

In this context, the board decided that although the management has taken a legal opinion from a renowned legal firm, another legal opinion from the Ministry of Law and Justice should also be sought prior to resolution of the matter.

USF signed a contract with Telenor on October 4, 2007 to provide services basic telephony and data services in Malakand Division. “A subsidy of Rs310 million is being provided to Telenor for this project,” according to Universal Service Fund’s website.

The meeting also discussed the hardship being faced by telecom operators in remote areas coupled with the high operational expenses, low revenues and expensive backhaul.

The board in this regard gave approval to the proposal of providing subsidy on operational expenses in these areas for three years following a declining trend model.

The administrative and human resource related issues of utilisation of funds were also deliberated upon.

Prime Minister Yousaf Raza Gilani said that the government considers development in the IT and telecom sectors to be of paramount importance for the overall progress of the country.

He said that the promise of Information and Communication Technology (ICT) by wide access of the cellular medium and broadband has made the ICT sector a top strategic priority for the democratic government for overall development in the country, Gilani added.

The Prime Minister said that the ability to communicate and derive the benefits of information driven era is no more a privilege of the elite but a basic right of the entire society.

He said that it is heartening to know that the government has, over the past three years, undertaken a well structured and successful programme for universal access for unserved and underserved areas through transparent targeted subsidy mechanism.

Optic fibre cable project in Balochistan approved

The board also gave approval for awarding contract for the optic fibre cable (OFC) project in Balochistan. Through the optic fiber project in Northern Balochistan, optic fibre connectivity will be provided to 12 tehsil headquarters and 8 other towns.

A population of around 2.1 million people will benefit from this project. Almost 40% of the total USF subsidy for all USF projects is being provided for projects in Balochistan.





Published in The Express Tribune, June 1^st, 2011.