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ISLAMABAD: The government is likely to grant force majeure to cellular mobile operators (CMOs) for 10 new infrastructure projects worth Rs8 billion which are facing serious problems in implementation due to the non-opening of Letters of Credit (LCs) for the equipment’s imports, it is learnt.

All the CMOs had requested the Universal Service Fund (USF) for delaying 10 new projects of around Rs8 billion to be implemented in un-served and under-served areas of the country.

Official sources revealed that the CMOs had written a letter to the USF and requested for delaying projects as they are facing serious problems in imports due to restrictions and non-opening of LCs. According to a clause in the USF agreement - force majeure -a USF service provider shall be excused, in accordance with the USF services and subsidy agreement, from certain failures to perform its obligations under the USF Services and Subsidy Agreement if an event of force majeure has prevented the performance of the obligations.

Expansion of telecom services: USF spends Rs 124 billion on implementation of 130 projects

Sources in the USF also confirmed the letter while saying that further deliberation is ongoing to decide the fate of new projects implementation.

The USF has contracted around 130 projects of around Rs124 billion so far across the country envisaging expanding telecom services to un-served and under-served areas.

USF; however, is facing several challenges including security, equipment theft, and equipment import as a result of Letter of Credit margin issues, which are hampering progress and delaying the timely execution of various projects in the pipeline.

The fund was created in 2007 to stretch cellular, broadband internet, fibre optics, and other telecommunication services to un-served or underserved areas. All telecom companies have been contributing 1.5 percent of their revenues to the fund. Telecommunication coverage was around 44 percent before USF was launched in 2006-07.

According to documents, of the total Rs123.5 billion subsidies, Pakistan Telecommunication Company Limited (PTCL) took a major chunk of Rs36.7 billion (29.7 per cent), Ufone Rs30.2 billion (24.4 per cent), Telenor Rs27.7 billion (23 per cent), Zong Rs5.637 billion (4.5 per cent), Wateen Rs4.847 (3.93 per cent), World Call Rs1.273 billion (1.03 per cent), Jazz Rs12.237 billion (9.9 per cent), and Nayatel Rs3.314 billion (2.7 per cent).

An official said that the “Broadband for Sustainable Development” program, under the USF, is designed to provide telecom services to the un-served mauzas across the country. After the issuance of 3G/4G licenses by the federal government, this programme has been redesigned to include broadband equivalent data (internet) services as a compulsory component.

For new projects, powering the telecommunication sites through solar energy was also made a part of each project. According to documents, 1,699 base transceiver stations (BTS) have been installed and 12,825 mauzas have been covered.

The optic fibre programme is another initiative under USF that aims to promote the development of telecommunication services in un-served and under-served rural areas to enable affordable, voice, telephony and basic data services. This also requires the establishment of a stable and reliable optic fibre network in all corners of the country. This project aims to extend optic fibre connectivity to the un-served tehsil headquarters for meeting the growing requirements of voice, data, and video in these areas.

Official sources revealed that some of the un-served and under-served areas in Balochistan and some in erstwhile Federal Administered Tribal Areas (FATA), still lack access to basic telephone and mobile broadband services. USF officials maintained that despite massive growth, many areas remained underserved. The challenges, they asserted, that the USF faced were rugged terrains, sparse population, harsh weather, lack of electricity, no backhaul, and poor logistics, as well as, security clearance.

Copyright Business Recorder, 2023

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