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Pak Supreme Court questions $705m USF siphoning

Pakistan’s Supreme Court has demanded a legal and constitutional explanation from the Attorney General (AG) for withdrawing around PKR70 billion (US$705 million) from the universal service fund (USF). The USF comes from all mobile operators’ 1.5% of gross revenue.

This entire fund is intended to be used to finance the expansion of telecoms services to underserved areas. Pakistan government has, however, forked out money from USF to meet its operating expenses, claiming that the funds would be replaced when and if required. Now, Justice Jawwad S Khawaja has questioned the government’s actions, remarking:

“How the government can spend USF on its requirements. This is licenses fee and this can be kept only in USF. This fund is aimed at providing telecom facilities in the respective areas at low expenses. Profit running into billion of rupees will not accrue due to withdrawal of billion of rupees by the government. Matter is pending since the last 10 months. Matter of 3-G, 4-G auction is in finalisation stage. Information memorandum has been sent on February 25 and auction will take place on April, 7. In this situation we want to decide the matter of withdrawal of Rs 70 billion by federal government before auction. It is essential to review the amendment introduced in USF rules on June, 29, 2013. Profit of billion of rupees can be dispensed with. We want to evolve proper rules and regulations in this regard. AG should assist us.”

A private company, established under companies act, manages the USF. This company is headed by a CEO and governed by a board composed of members from the public and private sector. Pakistan Today reports.

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