Industry Odisha Bureau, Oct 26: ISPs would own the customer relationship and receive direct subsidies of up to ₹12,900. The plan aims to lift household take-up on BharatNet’s largely built fibre backbone.
India is preparing to let internet service providers (ISPs) serve homes directly through BharatNet. The shift aims to speed up slow household connections on the state fibre network. Two officials told The Economic Times a registration portal is being built. Revised guidelines for ISP use of the network are also being drafted. A notification is expected soon, one official said. The changes have not yet been formally notified.
About 224,590 gram panchayats were linked by fibre by September end, per the DoT dashboard. Fibre reaching a village council, or gram panchayat, does not mean homes are connected. Households need a last-mile link and an active service plan. Against a target of 15 million homes, 1.64 million were connected by September. Active connections were lower, at 947,000 in April, the latest available figure. The two figures cover different dates and measures.
Under the current set-up, local entrepreneurs install connections as BSNL sub-contractors. They earn a sign-up bonus and a share of monthly subscriber revenue. The new model would let private and public-sector ISPs register independently. Each ISP would own the customer relationship directly. Providers would receive a direct subsidy of ₹8,900 to ₹12,900 per connection. That subsidy is linked to each new connection, not to monthly fees. ISPs would also keep 95% of monthly subscriber revenue. BSNL would take no revenue share. It would, however, remain BharatNet’s project management agency. State-owned RailTel and other ISPs could gain wider access to rural markets.
Of the ₹1.39-trillion corpus, ₹14,686 crore is set aside to subsidise 15 million household connections. That figure comes from an agreement between BSNL and Digital Bharat Nidhi (DBN). DBN is the government fund for connectivity in under-served areas. Telecom operators contribute 5% of adjusted gross revenue to it.
Accountability rules may test smaller operators. ISPs would need bank guarantees or surety bonds equal to subsidies received. Audits would check subsidies against new subscriber additions. One industry executive said guarantees may run for 30 months. Providers could have to repay subsidies if customers disconnect, the executive warned. Guarantees and repeated audits would also add costs.
Rajesh Chharia, president of the Internet Service Providers Association of India, backed the move. He urged the government to ease financial and reporting obligations. Rakesh Bhatnagar of Voice of Indian Commtech Enterprises welcomed better use of existing assets. He warned that rural users accustomed to free services may resist paying.
Network reliability is another factor. In August, the Comptroller and Auditor General (CAG) flagged weak operational performance. Only 33.2% of service-ready gram panchayats were operational as of November 2025. Fibre faults took an average of 17 days to restore. Those findings predate the proposed model.
BSNL, the DoT and RailTel did not respond to queries, the report said. Success will depend on the final guidelines and portal launch. Uptake by regional ISPs, faster fault repair and subscriber retention will matter most. Reliable service could support digital payments, e-health and online learning in villages.
