Trai slashes ISD call termination charges
NEW DELHI: The Telecom Regulatory Authority of India (Trai) on Friday slashed the international call termination charge from 53 paise a minute to 30 paise a minute, dealing a blow to telecom operators such as Bharti Airtel Ltd, Idea Cellular Ltd and Vodafone India Ltd.
Telecom firms had sought a hike in the rate to ₹3.5 per minute.
The termination charge is payable by an international long distance operator (ILDO) to the Indian telecom operator on whose network an overseas call terminates.
The new rate takes effect on February 1. The cut follows a steep reduction of the domestic interconnection usage charge— paid by one operator to another for landing calls on the latter’s network—to 6 paise a minute from 14 paise.
“While one cannot immediately estimate the size of the impact on most telecom operators, it will definitely be negative and is likely to impact earnings,” an analyst said.
The Cellular Operators’ Association of India (COAI), a lobby group, had sought a hike in the international call termination charge to ₹3.5 a minute. Reliance Jio Infocomm Ltd had pushed for a cut to 6 paise.
“COAI is of the view that the reduction in international termination charge (ITC) is against national interest, as the country will lose precious foreign exchange due to a sharp reduction of 43% in ITC by Trai, from the existing 53 paise to 30 paise,” Rajan S Mathews, director general of the lobby group, said in a statement.
The loss to telecom service providers on account of the reduced ITC received by them from foreign carriers for incoming international calls is expected to be approximately ₹2,000 crore annually, and this will also lead to a loss in revenue to the exchequer, from both licence fees and GST, Mathews said, adding that Trai’s move is a body blow to an already stressed industry.
COAI also conceded that its member Jio has a divergent view on this issue.
Emails sent to Airtel, Reliance Jio, Idea and Vodafone hadn’t been answered as of press time.