Government allocates Rp 45b for rural phones

Sari P. Setiogi The Jakarta Post Jakarta

The government has decided to allocate an initial Rp 45 billion (US$5.02 million) to provide basic telephone services in about 43,000 villages nationwide that have no access to the service.

"It took quite sometime to decide the amount of the budget allocated," Ministry of Transportation telecommunications and information director Tulus Rahardjo said on the sidelines of the National Seminar on Telecommunications 2003 on Thursday.

"In fact we should start the project at least by the end of December."

Earlier this year, the former spokesman for the Directorate General of Post and Telecommunications at the Ministry of Transportation, Gatot Dewa Broto, mentioned the total funding required for the project was Rp 475 billion.

"We will ask telecommunication service providers who already have well-established infrastructure to undertake the projects. We do not want them to spend too much of the budget on infrastructure. Most likely Telkom and PSN (Pacific Satelit Nusantara) will do the initial project this year," Tulus said.

However, he also said that Indosat might be invited to take part in the project this year, soon after they established their infrastructure.

PT Telkom, a state-owned company, held monopoly on the country's fixed-line telephone network for about 30 years until last year, when the government allowed Indosat to compete with the state company in the sector.

PSN offers a GSM satellite service using the Garuda-1 satellite technology.

Tulus also said the government would oblige the telephone operators to contribute 0.75 percent of their gross revenues to help fund the project.

"It is expected that the project would be finished in three years. However, with contributions from the telephone operators we expect the project could be completed even faster," he said.

The project is part of the implementation of the Universal Service Obligation (USO) program aimed at providing phone services for all citizens.

The USO was agreed upon during the International Telecommunications Union (ITU) conference in Nairobi, Kenya, in 1995, when all countries were advised to provide their citizens with basic telecommunications facilities, such as telephone, fax and telegram services.

Furthermore, the Asia Pacific Telecommunications (APT) organization at its summit in Tokyo in 2000, issued the so-called Tokyo Declaration calling on all member countries to provide all of their citizens with access to telecommunications by 2005.

"Currently, Indonesia has a fixed-line penetration rate of 3.6 percent, meaning since our independence in 1945, we thus far can only provide 8 million fixed lines for a population of more than 220 million," Director General of the Directorate Post and Telecommunications, Djamhari Sirat, said in his keynote speech during the conference.

In comparison, there were 14.3 million cellular phone subscribers in Indonesia as of June this year since cellular service was first introduced in the 1980s, according to the Secretary General of the Indonesian Cellular Telecommunications Association (ATSI), Rudiantara.

He estimated the number would increase to 17 million by the end of this year.