R. S. Sharma, chairman of telecom regulatory authority of India (TRAI) is a pioneer of Digital India. He is responsible for conceptualising and initiating the program when he was secretary of DeIT. The government has now approved the second phase of Bharatnet program, under which high speed broadband would be provided to the Village Panchayats. He spoke with Business World on the status of Digital India. Excerpts of interview:

Q: You are architect of Digital India program. What is the reason that the results of Digital India program couldn’t reach the masses, especially in rural areas?

A: Since the commencement of Digital India program, the broadband numbers have seen a steady increase. Broadband is basically an ecosystem of several independent components that function efficiently when they are together and sub-optimally in isolation. Main components of this eco system include policies to promote digital literacy, development of locally relevant content and applications, and creating threshold demand. When all these components are in place, availability of broadband is very effective, akin to a force multiplier.

For broadband penetration in rural areas, the government is rolling out BharatNet using the Universal Service Obligation Fund (USOF). Once this project is implemented, availability of broadband in remote and rural areas will improve.

Another interesting aspect is that a few service providers are claiming that they are planning to roll out their networks in rural areas also. We have to wait and see.

Q: Why National Optical Fibre Network (NOFN) project that was supposed to provide broadband in villages could not meet its deadlines?

Department of Telecommunications (DoT) had set up a Committee that submitted its report on 31 March, 2015. The committee identified accountability fears and misaligned incentives for the implementation agency as major issues responsible for massive delays in project. When TRAI did a suo-moto consultation, it emerged that “public-private-partnership” (PPP) model is best suited for this project. Under PPP model, private sector’s capacity for delivery is combined with the government’s role as an enabler and regulator to overcome market failures.

Build-Own-Operate-Transfer (BOOT) model has potential to ensure long-term incentive and reduces risks. In our recommendations dated 01 February, 2016, we stated: ‘A PPP model that aligns private incentives with long term service delivery in the vein of the Build-Own-Operate-Transfer/Build-Operate-Transfer models of implementation be the preferred means of implementation.’

Our understanding is that the implementation of a project like BharatNet should be done by entities that have their own interests in monetisation of the network. From various media reports we have come to know that the government has approved the next phase of BhartaNet project.

Q: Why private players have not shown any interest in providing broadband in rural areas?

We are aware that the private sector has not yet shown much interest in penetration in rural areas. In our recommendations to the government, we have stated - ‘It becomes desirable to structure the private sector’s involvement in a manner that aligns long-term private sector incentives with the State’s social and public service delivery objectives. Such alignment of incentives is possible in a PPP model and can go a long way in reducing the need for extensive and granular public sector monitoring, reducing the state/monitoring agency’s role to simply ensuring outcomes in special circumstances. Bundling construction and operation is efficient as it requires private parties to internalise operation and maintenance costs, generating incentives to design the project in a manner that minimises life-cycle costs’.