Trai slashes international call termination rate to 30 paise per minute

The Telecom Regulatory Authority of India (Trai) has reduced international termination charges (ITC) paid by international operators to local networks that receive calls by 43 per cent to 30 paise per minute, making international calls to India cheaper.

The move will hurt revenue of India's telecom operators already reeling from ongoing brutal price wars.

Incumbents Bharti Airtel, Vodafone India and Idea Cellular have asked the Trai to withdraw its decision on grounds that reduction to 30 paise from the earlier 53 paise a minute would lead to massive loss of revenue to the exchequer, though Reliance Jio did not back the plea.

''Authority has decided to revise the termination charge for international incoming call to wireline and wireless from Rs0.53 per minute to Rs0.30 per minute,'' said Trai on Friday, adding that its aim was to stymie the 'menace' of grey route of international calling which it said also posed a 'serious threat' to national security.

Trai said it facilitating the shift of the international incoming traffic from over-the-top (OTT) - apps like Whatsapp, Viber and Skype used to make voice and video calls over the internet - to carrier route was a more important regulatory priority.

''Arbitrage opportunity between ITC and domestic call tariffs would become so insignificant that illegal voice over internet protocol (VoIP) gateway business in India would become unviable; in turn, the grey market for ILD (international calls) incoming traffic would eventually cease to exist,'' Trai explained further.

The new rate comes into effect from 1 February. Trai will monitor the trends and patterns of incoming international calls and may review the rate from time to time, but did not give a roadmap.

Trai added that the move would not only plug the leakages in the revenue accruable to the country and Indian telecom players but would also ensure that India continues to earn foreign exchange from the international incoming voice traffic business.

Rajan Mathews, director general, Cellular Operators Association of India (COAI), however, said, ''It is against national interest, as the country will lose precious foreign exchange, due to a sharp reduction of 43% in ITC by Trai.''

On the other hand, had Trai decided to increase ITC rate to Re1 per minute,  industry and the country would have benefitted from incremental forex of Rs6,000 crore and an additional forex of around Rs10,721 crore had the ITR been eventually increased to Rs3.5 per minute.