Print Friendly, PDF & Email

Insights into Editorial: NOFN project yet to fulfil promise for rural India

Insights into Editorial: NOFN project yet to fulfil promise for rural India

Article Link

16 June 2016

According to the latest figures, as of 2 May 2016, the OFC (optic fibre cable) pipe laid in India is 139,582 km, optical fibre laid is 111,726 km. OFC pipe is laid in around 61,000 gram panchayats and optical fibre in 50,500 gram panchayats. This shows that the National Optic Fibre Network (NOFN) project is on its way to achieve its stated objectives.

National Optical Fibre Network (NOFN):

The NOFN project was approved by Cabinet in 2011 and deadline to connect all panchayats was fixed by end of 2013 then deferred to September 2015 by UPA government. The Narendra Modi-led government re-examined project status and set target to complete roll out in 50,000 village panchayats by March 31, 2015, and another 1 lakh by March 2016 and the rest by end of 2016.

Key facts:

  • It is a project to provide broadband connectivity to 250,000 Gram panchayats of India at a cost of Rs.20,000 crore.
  • The project provides internet access using existing optical fiber and extending it to the Gram panchayats. Connectivity gap between Gram Panchayats and Blocks will be filled.
  • The project was intended to enable the government of India to provide e-services and e-applications nationally.
  • A special purpose vehicle Bharat Broadband Network Limited (BBNL) was created as a Public Sector Undertaking (PSU) under the Companies Act of 1956 for the execution of the project.
  • The project will be funded by the Universal Service Obligation Fund (USOF) and was estimated to be completed in 2 years.
  • The project envisaged signing a tripartite MoU for free Right of Way (RoW) among the Union Government, State Government and Bharat Broadband Network Limited (BBNL).
  • All the Service Providers like Telecom Service Providers (TSPs), ISPs, Cable TV operators etc. will be given non-discriminatory access to the National Optic Fibre Network and can launch various services in rural areas. Various categories of applications like e-health, e-education and e-governance etc. can also be provided by these operators.

Universal Service Obligation Fund:

USOF, established in 2002, provides effective subsidies to ensure telegraph services are provided to everyone across India, especially in the rural and remote areas. It is headed by the USOF Administrator who reports to the Secretary, Department of Telecommunications (DoT).

  • Funds come from the Universal Service Levy (USL) of 5% charged from all the telecom operators on their Adjusted Gross Revenue (AGR) which are then deposited into the Consolidated Fund of India, and require prior parliamentary approval to be dispatched.
  • The USOF works through a bidding process, where funds are given to the enterprise quoting the lowest bid. However, the funds for NOFN were made an exception to this process since BBNL was the sole party involved in the implementation having being specifically created for it.


While much has been said about the connectivity, little is said about how many kilometres of this optic fibre is actually functional or how many gram panchayats are actually utilizing this connectivity to access the Internet or how connected gram panchayats will distribute the facility to other village-level institutions and households. Incidentally, after almost four years, even the pilot locations are not fully functional.

  • Various independent surveys have shown that despite having Wi-Fi towers set up, fibres in many villages were not operational. Added to this is the lack of awareness about NOFN among the villagers.

Significance of this project:

Penetration of optical fibre is extremely important in a country like ours. One of the reasons why a major part of India remains marginalized is because there is no access to the Internet—and, therefore, no information.

  • It is also because of lack of access to an operational optic fibre network that people do not receive their entitlements, their grievances do not reach the authorities, and they find it tough to make the most of entrepreneurial and business opportunities.
  • Also, NOFN is a matter of mass connectivity and a massive amount of public money is involved. If a project like NOFN were to become a reality, it could reduce the need for several social welfare schemes.


The main challenge is getting this project done through a sustainable framework. Starting with the end user and the PSPs, affordable connectivity would require regulation on pricing and ensuring availability of certain essential content, including those provided by the government.

What needs to be done?

An expert panel set to expedite roll out of broadband in rural areas has suggested revamp of national optical fibre network (NOFN) initiative, increasing the scope of the project that will entail three fold increase in cost to Rs.72,778 crore from about Rs.20,000 crore approved earlier.

  • The committee has estimated the total cost of the revised project at Rs.72,778 crore, which is three fold higher than Rs.20,000 crore approved earlier.
  • The report stresses on involvement of States, besides private players, for speedier implementation of the project that has fallen far behind its planned schedule.
  • The Committee has also re-worked the timelines for implementation, stating that the project can be commissioned by December 2017.
  • Seven States have proposed to come up with their own model to roll out broadband network under BharatNet programme.


Broadband access to every citizen is a key pillar of Digital India. The issue is more significant for the rural population. While the government is making a large amount of information available online, especially since the Digital India initiative, it has to ensure that this information is actually accessible to the people. Connectivity can bridge this gap and provide access to not just the Internet but also to food, health, education, jobs, rights and opportunities. This is the reason why progress or the lack of it on NOFN is a matter of national concern.