In a much significant stride to curb the proliferation of grey markets that are being operated to route ISD calls made to India through illegal Voice over Internet Protocol (VoIP) Gateways, TRAI on Friday announced a sharp 43 percent reduction in International call Termination Charges (ITC) to bring it down to 30 paise from the prevalent 53 paise. The stipulated new rates shall become applicable from February 1.
It has to be noted that International Termination Charges are the charges that are being paid by the international telecom operator to the local network operators in lieu of the terminating/transmitting the call. This unexpected move of TRAI is touted to impact the revenues of top telecom networks that are operating in market (the likes of Vodafone, Bharti Airtel, Idea) by a whopping Five Thousand Crores in coming year. However, the rationale behind such a step is that it would lessen or rather neutralize the gap of arbitrage between International Termination Charges and domestic tariff which paves the way for illegal VoIP gateway practices in the country. Therefore, this step would help in eliminating the grey market for International Long Distance Operator (ILDO) incoming traffic by making illegal VoIP gateway business infeasible and un-efficacious.
However, it is worth noticing that this move of TRAI could pose a negative impact on nation’s interest in more ways than one. Reduction in charges by 43 percent would result in severe decrease in the flow foreign exchange in the counter, as has been stressed upon by director general of Cellular Operators Association of India (COAI) also. Loss of revenue to telecom operators would eventually impact the revenues to the exchequer arising from license fee and GST. Further, the revised rate is not anticipated to accrue more benefits to the consumers, rather it could result into benefitting the foreign carriers at the cost of tampering with the interests of domestic players.
TRAI should analyse the wholesome impact of the new approach so as to ensure the maximum benefit at the cost of compromised interests of various stakeholders.
Courtesy/By: Lalit Saraf
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14 Jan 2018
