Digital Bharat Nidhi

Current Context : Digital Bharat Nidhi would replace the erstwhile Universal Service Obligation Fund (USOF).

ABOUT USOF

• It is a financial mechanism to support the expansion of telecommunication services, especially in rural and remote areas.
• It was created in 2003 to improve telecom services in parts of the country that don’t make a lot of money.
• It is funded by a 5% tax on telecom operators’ adjusted gross revenue (AGR).

ABOUT DIGITAL BHARAT NIDHI (DBN) :

• It is an initiative by Department of Telecommunications (DoT).
• It would replace the erstwhile Universal Service Obligation Fund (USOF) to ensure better allocation of resources.
• Aim : improve internet connectivity, particularly in rural, remote, and economically disadvantaged areas, foster technology innovation, promote innovation and to support startups in the telecom sector.
• This money would be used to fund the expansion of telecom networks in remote and rural areas.
• It will focus on research, development, and overall connectivity improvement.
• Funding : Payments received for DBN will first be credited to the Consolidated Fund of India. They will then be credited to the DBN by the central government (on parliamentary approval through a law).