Mobile Communications - India Reduces Levies on Local, Int'l Calls
January 10, 2005
Hoping to stimulate demand in the telecom market, India's Telecom Regulatory Authority has recently cut rates of local and international phone calls. Charge on outgoing international calls was reduced to 2.5 Rupees (US$0.057;US$1=44 Rupees) per minute from 4.25 Rupees (US$0.097). Rates on incoming international calls were cut to 3.25 Rupees (US$0.074) per minute from 4.25 Rupees (US$0.097).
Rates on local and national long-distance calls have also been cut to 0.3 Rupees (US$0.007) per minute from a range of 0.3 to 0.8 Rupees (US$0.018) per minute before.
Several operators in India have already expressed commitment to follow the rate reduction policy. They are expected to pass on the benefit of the reduced ADC (Access Deficit Charge) to subscribers to expand subscriber bases both by attracting new users and lure existing ones from competitors. The ADC is imposed on Indian operators to support state-run Bharat Sanchar Nigam Ltd's loss-making rural expansion program.
The rate reductions will be enacted beginning from February 1st of 2005. Once identifying usage patterns in the next three to six months, Telecom Regulatory Authority will conduct further cuts.
Bharti Tele-Ventures, a GSM-based mobile operator in India, was one of the first companies to announce it would drop rates in accordance with the reduced levies.