COAI seeks 6-fold hike in termination charges on overseas calls

The Cellular Operators' Association of India (COAI) has demanded a steep hike in international termination at a time when the telecom sector regulator Trai has drastically reduced domestic call termination charges and proposed to do away with it over a period of time.

COAI has now demanded that termination charges for international calls be raised to Rs3.50 a minute from the current 53 paise per minute in order to correct the imbalance between the rates charged in India and overseas rates.

The Telecom Regulatory Authority of India (TRAI) is currently in the process of reviewing these rates, paid by foreign carriers for terminating international calls in India.

"Today, there is a 20:1 imbalance between incoming and outgoing international calls. In order to adjust the imbalance, you need to go to Rs3.50 on a weighted average basis, to correct the arbitrage," PTI quoted COAI director general Rajan Mathews as saying.

COAI has argued there is a need to bridge the gap between blended termination rate paid by Indian operators for outgoing international calls and the termination rates received by them on international incoming calls.

Mathews sought to draw a distinction between termination charge complexities that come into play for domestic and international calls. "International interconnect rates are not as simple as domestic because there are multiple countries with their own regulatory processes and they set their own rates...also there are currency fluctuations to deal with," Mathews added.

The blended termination rate paid by Indian operators is around Rs. 3.50 a minute for outgoing international calls compared to 53 paise per minute termination rate received by them on incoming international calls, COAI has contended.

"Therefore, we are saying that our operators are at a disadvantage because we end up paying precious foreign exchange out...the problem with international is that (Indian) regulator has no control on the other side (for outgoing call termination charges) so other side is free to charge whatever they want," he said.

TRAI will come out with a separate regulation on the international termination charges.