The Telecom Regulatory Authority of India on Tuesday reduced termination charges to 6 paise a minute from 14 paise. The revised rates will be effective October 1. Trai said the charges will be completely scrapped from January 1, 2020.
An operator charges their rival an Interconnection Usage Charge when a user ends a domestic call on their network. With the prices slashed, call rates are expected to drop.
Trai said telecom operators should migrate to newer technologies that may help bring down the cost to provide services. “...In case the present regime of cost-based domestic termination charge is continued for long, it would hamper the movement of the sector towards deployment of more efficient technologies and more innovative and customer-friendly tariff offerings and, in turn, it would be detrimental to the growth,” the regulatory body said.
However, mobile operators such as Bharti Airtel and Vodafone India have opposed the move, saying telecom companies largely depend on the revenue they make from incoming calls in rural areas. Reliance Jio claimed that termination charges had helped established operators earn Rs 1 lakh crore since 2014.
Vodafone said it was disappointed with Trai’s decision as it comes at a time when the Indian telecom industry is “experiencing the greatest period of financial stress in its history”, reported The Indian Express.
The Cellular Operators Association of India called Trai’s decision “disastrous” and said they may move the court against it.