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September 10, 1998


Big overhaul in telecom tariffs

Email this story to a friend. The Telecom Regulatory Authority of India has proposed a steep hike in rentals for both basic and cellular services while recommending a sharp reduction in ISD, STD and airtime charges.

The across-the-board restructuring in telecom tariffs also includes increase in local call and paging charges. The TRAI has also suggested significant reduction in leased lines rentals, Internet tariffs and inter-connectivity
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Airtime charges for cellular services have been reduced to Rs 6 per minute in peak hours, but rentals have been increased four-fold to Rs 600 a month.

Releasing the consultation paper on telecom pricing I New Delhi yesterday, TRAI Chairman Justice S S Sodhi said "We have now embarked on a round of consultations with the Department of Telecommunications, industry and consumer groups to incorporate any modifications before issuing a final notification by the end of this year."

TRAI has also proposed to introduce a concept of 'calling party to pay' that will make incoming calls to a cellular subscriber free. Landline calls made to mobile phones will be charged to the caller at a rate of Rs 3.90 per minute.

TRAI has suggested that the Rs 3.90 charge per minute be shared between basic operators who will retain 15 per cent of the revenue with the remaining 85 per cent going to cellular operators.

In a major sop for Internet service providers, VSNL port charges are proposed to be slashed from Rs 110,000-Rs 7.2 million to Rs 70,000-Rs 4.18 million. Leased line charges have also been rationalised to encourage usage.

The TRAI has also proposed to give a lift to the paging industry by suggesting that messages to pager numbers cost Rs 1.50 per call. It has proposed a hike in pager rentals of alphanumeric and numeric type from Rs 250-Rs 300 and Rs 150-Rs 175 per month respectively.

Inter-exchange junction charges have also been reduced from a range of Rs 12,900 to Rs 216,000 and Rs 7,100-Rs 36,940 per port.

TRAI has proposed to revise telephone rentals in rural areas from the existing Rs 50 to a maximum of Rs 120. For the semi-urban and urban areas, the rental slab has been raised to Rs 160-Rs 310 from the current Rs 75-Rs 190.

Local call charges that range from 60 paise to Rs 1.40 per unit are now proposed to be raised to a flat rate of Rs 1.30 at the maximum.

These calls will be charged every 3 minutes instead of the earlier 5 minutes.

In non-rural areas, where current charges are in the range of 80 paise to Rs 1.40, the rates have been capped at a uniform Rs 1.40.

This cap means that this rate would be the maximum chargeable rate by a service provider, however, operators would be free to charge lower rates than the cap.

The number of free calls allowed in every bimonthly billing cycle, currently fixed at 150 calls in urban and 250 in rural areas, is now proposed to be brought down to a uniform 120 calls.

For domestic long-distance calls or STD calls, the TRAI has proposed the existing eight distance categories for call charges to four slabs of 0 to 50 km, 51 to 200 km, 201 to 500 km and above 500 km. The earlier rates applicable to these slabs varied between Rs 0.27 to Rs 2.33 per minute, the revised rates will now only be Rs 0.43 for distances up to 50 km.

Between 51 to 200 km, the existing slab of Rs 4 to Rs 10.73 per minute will now be Rs 3.90.

For distances in the slab of 201 to 500 km where charges vary between Rs 12 to Rs 28, the rates will be slashed to Rs 9.75. For 500 km and above, the charges will be Rs 19.50 per minute, down from the earlier Rs 16 to Rs 42.

A revenue sharing agreement has also been proposed to resolve the controversy between new service providers and DoT.

The rates for international calls have been capped at Rs 30 for Europe, Gulf, Asia, Africa and Oceania, Rs 39 for the American continent and Western Hemisphere and Rs 19.50 per minute for SAARC and neighbouring countries.

- UNI and the Indian media

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