India's state-run telecom operator Bharat Sanchar Nigam Ltd (BSNL) will erect 19,000 towers in two phases to extend mobile phone connectivity to all villages in the country, the government said Wednesday.

"Some 8,000 mobile towers will be erected by the end of this year under Phase-I of the shared mobile infrastructure scheme," India's Telecommunications Minister A. Raja told a parliamentary committee here Wednesday.

Another 11,000 towers will be erected in the second phase, he said while addressing members of the Consultative Committee of Parliament attached to his ministry.

BSNL will also procure 93 million GSM lines so that people in all villages in the country having a population of more than 1,000 can avail of mobile phone services, he said.

GSM stands for Global System for Mobile communications and is the world's most widely used mobile phone technology.

"The government is giving the highest priority to extending telecom facilities to rural and remote areas of the country," he said.

To provide broadband connectivity, the government will initially connect 5,000 blocks, the smallest administrative unit in India, by wireless broadband, he said.

Villages coming within a radius of 10 km of a block headquarter will be covered by such connectivity.

This will benefit schools, public health centres, village administrative bodies (panchayats) and the community service centres (CSCs) meant to provide e-governance and data services to rural areas.

This will be done soon after new spectrum is allocated to the various telecom operators. This activity will be funded with the support of the universal service obligation (USO) fund, he said.

The USO fund is created from a 5 percent universal service obligation levy that the government charges all telecom operators in India.

The fund is meant to support extension of connectivity to areas where private operators do not enter for lack of adequate profitability.

To ensure widespread rural connectivity the ruling United Progressive Alliance coalition government has kept a target of 500 million telephone connections by 2010 and 750 million connections by 2012, Raja said.

He hoped that this target would be surpassed.

He said to promote expansion of rural wire line and wire line based broadband services, the government has recently decided to waive off the license fees for rural wire line.

The government has also decided to give USO fund support to BSNL and reduce USO levy from 5 percent to 3 percent for covering more than 95 percent of the development blocks, he said.

This was in accordance with a recommendation of India's telecom regulatory body Telecommunications Regulatory Authority of India (TRAI), he said.

The Minister also said that BSNL will launch during the current year value added services like mobile banking, mobile advertisement, tele-education and lost mobile tracking systems.

BSNL will also provide wireless broadband services and upgrade its mobile network to third generation (3G) levels. It will also provide high-speed data services.