'Slashing termination rates a body blow to an already stressed industry'

The Cellular Operators Association of India (COAI) opined that the reduction of international terminal charges by the Telecom Regulatory Authority of India (TRAI) is "against national interest", and recommended that the regulation should be reviewed.

"The Indian Telecom Industry is passing through one of its toughest phases with severe financial stress and has been seeking relief from the Government. The regulation from TRAI to slash international long distance termination rates from 53paise to 30paise per minute is a body blow to an already stressed industry. The reduction does not benefit any customer, and will only benefit foreign carriers at the expense of the domestic industry," said Rajan S. Mathews, Director General of COAI.

Due to the reduction in the aforementioned charges, COAI claimed the country would lose precious foreign exchange due to a sharp reduction of 43 percent in termination rate by TRAI, thereby urging the government and telecom authority to re-examine the regulation, and "rescind it in the interest of the nation and the telecom industry."

"The loss to Indian telecom services providers on account of the reduced rates received by them from foreign carriers for incoming international calls is expected to be approximately Rs. 2000Crores annually, and this will lead to a loss in revenue to the exchequer, from both Licence Fee and the Goods and Services Tax (GST)," said Rajan.

The TRAI on Friday slashed termination charges payable by international long distance operators (ILDO) which carry calls from outside the country, to the access provider in the country, in whose network the call terminates.

As per the Telecommunication Interconnection Usage Charges (Fourteenth Amendment) Regulations, 2018, the telecom regulator notified that the termination charges have been reduced from 53 paise to 30 paise per minute.