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Nothing related| India: Telecom tariff reductions |
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| Tuesday, 14 December 2004 | |
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The Telecom Regulatory Authority of India (TRAI) believes that access deficit charges (ADC) can be further reduced. India’s telecommunications tariffs are among the lowest in the world – an average of less than US$0.02.
Reducing the ADC could lead to even lower telecom tariffs. The ADC is paid by other operators to BSNL – largely to finance rural telephony services – and currently stands at Rs 50 billion a year. In 2003, there were 13 million mobile subscribers in India and by November 2004, that number had grown to 47 million. According to TRAI chairperson Pradeep Baijal, the higher subscriber numbers give the operators the financial ability to reduce tariffs, therefore government and operators must work towards bringing down the tariffs. Thus, there is also space for reducing the ADC. The ADC is different on different call types and therefore the reduction will be different for different calls, according to Baijal. TRAI believes that cutting the ADC will increase mobile subscriber growth. Baijal says that unless the ADC is reduced, increasing the growth rate of the mobile sector would be difficult. He believes that lower tariffs will also mean more growth in rural areas, which represent a huge market. According to Baijal, even the Universal Service Obligation (USO) and revenue share paid by operators to the government must be reduced. "We have a strong case for that. If you reduce the revenue-share, the addressable market will be higher and the government would be compensated by growth rather than revenue," he said. Intelecon Research & Consultancy Ltd. 14/12/2004 Source: Economic Times |
