New Delhi, July 10: Rural telephony expansion in the country is set to gain momentum with the government today approving an amendment in the Telegraph Act of 1885 to give a statutory backing to universal service obligation fund, used for compensating the non-profitable telecom businesses. The government would move a bill in this regard in the coming session of Parliament, the communication and it minister Arun Shourie told reporters after the cabinet meeting here.
Government had collected Rs 1760 crore in the last financial year by way of levying USO fee (five per cent of the total 15 per cent licence fee) although only Rs 300 crore could be allocated for this purpose in the absence of necessary provisions in the Telegraph Act.

With the change in the act, USO fund would get the statutory status, which in turn would help the telecom companies to roll out services in the rural areas and unviable areas, at a faster pace.
As per the new telecom policy 1999, the private operators are obliged to offer rural telecom services as part of their licences. Bureau Report