Non-approval of funds delaying USF projects

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Almost a year has passed since the six projects worth Rs5 billion of Universal Service Funds (USF) have been pending due to non-approval of the annual budget. It has been learnt by Profit that in the beginning of this financial year USF had to re-advertise total six projects including 3 projects of broadband for Sindh, Khyber Pakhtoonkhwa and Punjab, 1 fiber optical project for Khyber Pakhtoonkhwa, 1 rural telecom project for Balochistan, and 1 pilot project of telecenters for the entire country. And the reason for the delay of all these projects is the non-approval of the annual budget of Rs17 billion dedicated to USF by the Ministry of Information Technology (MoIT) due to unavailability of the Prime Minister to convene a meeting in this regard, source informed. Similarly, a project of Rs2.5 billion (out of which Rs2bn is being provided by the government as a subsidy) to provide Optic Fiber connectivity in Northern Balochistan has still not been initiated as the USF could not provide 20 per cent mobilisation advance of Rs400 million to the bidder due to non-approval of its annual budget, sources said. Considering this uncertain situation, the investors are confused whether to bid for these projects or not because they have to dedicate resources, conduct surveys etc. for the preparation of participating in the bids for these multi-billion rupee projects, source added. Now all leading investors including Pakistan Telecommunication Company Limited (PTCL) and Wateen Telecom (Pvt.) are adhering to ‘wait and see’ policy in this regard. Industry analysts believe that this stalemate is dangerous for the government as the initiation of these projects assure new job opportunities for the people, while the private sector and investors are also getting fed up of this situation which might result in further deterioration of the economy. When contacted, Chief Executive Officer of USF Parvez Iftikhar confirmed the non-approval of the annual budget of the funds and said the opening dates of the bids for the said 6 projects have been further extended from mid September to October due to this non-approval of the annual budget. To a question he said USF is dedicated to facilitate the un-served areas of the country and in this regard they want to do projects worth of Rs10 billion in the current financial year of 2011-12. According to the mission statement of the funds, USF was established by the government to spread the benefits of the telecom revolution to all corners of the country, and it promotes the development of telecommunication services in un-served and under-served areas throughout the length and breadth of the country.