TRAI cuts access deficit charge

New Delhi: The Telecom Regulatory Authority of India (TRAI) yesterday announced a cut in the access deficit charge (ADC). ADC is a charge on telephone operators for subsidising rural telephony. The new ADC rates come into effect from February 1, 2005.

As per the new rates, the ADC on inter-circle calls has been slashed by 62.5 per cent to 30 paise for domestic long-distance calls beyond 200 km. The ADC for inter-circle calls for distances between 50 km and 200 km has been reduced by 40 per cent to 30 paise from 50 paise.

For international long distance calls, the charges have been reduced by 41.18 per cent on outgoing calls and 23.53 per cent on incoming calls. From the existing flat rate of Rs 4.25, the new deficit charges are Rs2.50 for outgoing and Rs3.25 for incoming.

There has been no change in the ADC for local and inter-circle calls between two points, which are up to 50 km apart. Rates of local calls, whether cell-to-cell, cell-to-fixed line or fixed line-to-cell, are unlikely to undergo any change as the ADC charges for them remains unchanged.

TRAI has also said that fixed line operators like Bharti, Reliance and Tatas (other than BSNL) would retain ADC only on their outgoing calls. ADC on all other calls will be provided to BSNL, it added.

TRAI chairman Pradip Baijal said the reduction would not affect BSNL's operations and the simplified regime would help increase telecom penetration and density.

"The total ADC amount earned by BSNL will remain unchanged at Rs5,000 crore. As there has been an exceptionally large increase in call minutes. TRAI has been able to decrease the per minute ADC and ensure that the total amount collected remains the same," Baijal said.

A K Sinha chairman and managing director BSNL said the cut was based on assumption of increase in traffic. ADC is paid by private cellular operators to compensate BSNL for providing rural telephony.

Bharti Tele-Ventures's chairman, Sunil Mittal has announced that Airtel will pass on the benefit of the entire cut on the ADC to customers from February 1. "We believe it is a good beginning, but there is a long way to go. Consumers should expect the 100 per cent reduction in their hands from February 1, "Mittal said on the sidelines of a conference in the capital.