Calls to India to cost more

Calls to India to cost more

By GOPAL SUTAR | ARAB NEWS

Published: Nov 10, 2010 23:08 Updated: Nov 11, 2010 17:03

The Telecom Regulatory Authority of India (TRAI) is seriously considering increasing termination rates for the international operators for the incoming calls, especially in case of those based in the Gulf countries.

According to the reliable sources in TRAI, this is being done as per suggestions received from various telecommunication operators in India. This would also mean huge jump in the government revenue at the cost of millions of Gulf-based Indians who will have to pay more for each call they make to India as and when the TRAI implements the hike in the termination fees. “There is no reason for TRAI to dither,” feels an analyst in the telecom sector.

According to the sources, Indian companies charge 1.2 cents on an average per call as termination charges as against 13 cents charged by the Gulf-based companies for the incoming calls in those countries.

The high termination rates applied by them are considered anti-competitive by some in India. One of the main objectives of TRAI is to provide a fair and transparent policy environment that promotes a level playing field and facilitates fair competition and therefore sooner or later it has to look into this.

Experts in India feel that even regulators in the Western countries such as the United States have put safe guards in place against the overcharging by foreign market powers. If unchecked, operators from other countries may follow the Gulf model to earn more at India’s expense.

According to TRAI sources, India’s forex loss is to the tune of Rs.8.25 billion — nearly $180 million — due to differential settlement costs. The operators in India received around Rs.4.75 billion annually from telecom companies in the Gulf as termination fee, but paid over Rs.13 billion for terminating their traffic in the Gulf.

“The case has been made to the government pointing out this huge discrepancy. It is more difficult to accept this in India where the competition is severe due the presence of several private and government operators. This is not the case in the Gulf where one or two operators have virtual monopoly over a large market in each country,” says an official from a private operator who did not want to be quoted.

http://arabnews.com/economy/article185824.ece