ADC cut not likely due to DoT- Trai differences

A reduction in the access deficit charges (ADC) in the immediate future seems unlikely, with the Department of Telecommunications (DoT) and Telecom Regulatory Authority of India (Trai) being at loggerheads over the mode that is to be adopted over the reduction of telecom tariffs in the country.

The DoT had issued a policy diktat under section 25 of the Trai Act, with an objective to ensure that tariffs were reduced under its OneIndia Plan of doing away with STD dialing, and introducing uniform call rates across the country.

This was mainly because the regulator shared the view that further reduction in the ADC would pave way towards lower tariffs in India.

Even as Trai had already initiated the process of lowering the ADC, the government's OneIndia policy had made no progress till date, with a slew of issues including reworking of the present licensing regime, new interconnection agreements within operators in addition to devising a policy to compensate BSNL, remained to be sorted out.

When contacted, senior Trai officials said they were unaware of any such development of the DoT issuing a policy diktat.

On the other hand, DoT officials said the government had no intention to curb the powers of the regulator. While refusing the contents of the dikat, an official said, "The government had the jurisdiction to issue dikats to any agency or authority, to ensure that the same worked within its (the government's) line of thinking."

"The government has a commitment towards lowering tariffs"�we only want to steer the authority within this direction. Trai is a separate body, which, however, worked within the government framework," said a DoT source.

"Their powers had not been diluted. They continue to be independent in their day-to-day functioning. We were only steering them towards the telecom policy of the UPA government," the official added.

Sources within the government also said the government preferred OneIndia since the ADC reduction would further "threaten the position, marker share and finances of state-owned Bharat Sanchar Nigam Ltd (BSNL) and Mahanagar Telephone Nigam Ltd".

The reduction in the ADC levy was slated before the OneIndia plan was announced. The policy, when announced, would therefore be meaningless to cellular operators, but create extensive BSNL network, as it will force the PSU to reduce STD tariffs for landline subscribers, an industry official said.

However, DoT officials were confronted with a new problem. Even if the government were to impose uniform call rates, it would not be able to intervene if private operators raised rentals, to offset any possible losses arising out of uniform call rates.