Trai Is Taking These Steps to Improve Health of Telecom Sector But Still There are Hurdles

The Telecom Regulatory Authority of India (Trai) is responsible for overseeing the regulations in the telecom and other related industries. The year 2019 has been a very important one for the telecom regulatory majorly because of the regulations that it has issued and whatever has ensued in the sector as a whole. But, right now, the responsibility on the shoulder of Trai is a huge one because the telecom regulator has to take care of the industry which is financially bleeding and is in the worst possible situation imaginable. The telecom operators are under massive debt and are running huge losses. In such a case, Trai wants to introduce measures which would help the telecom operators in cutting their losses and improving their financial health. There are some discussions which are currently going on, and consultation papers which are in the process that could help the telcos in fixing their finances. Here are some of the measures that Trai might introduce and the hurdles that they face.

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Floor Pricing in Telecom Industry

The first measure that the Telecom Regulatory Authority might make in favour of the telecom operators is the move to bring a floor tariff regime. This would essentially mean a second tariff hike in the telecom industry. The subscribers in the telecom industry have already seen a tariff hike in the recent weeks, but if the floor pricing plan comes into effect, then the tariffs would further increase and help the telecom operators in raking in more revenue. Bharti Airtel is already keeping hopes for ARPU of Rs 200 per month, which might climb up further to Rs 300 if the floor pricing plan works. On this front, Trai has already floated a consultation paper which is awaiting comments from various industry stakeholders. Although the regulator is itself reluctant for floor pricing because of the anti-consumer aspect of the rule, if brought into effect, it will bring more revenue for the companies like Vodafone Idea and Bharti Airtel.