Trai Set to Cut Interconnect Rate to Below 10 Paise per Minute: Report

The Telecom Regulatory Authority of India (TRAI) is set to introduce the new interconnect usage charges (IUC) rate, which will be under 10 paise per minute, as compared to the currently 14 paise per minute rate, according to a Times of India report. The move will lead to more cuts in voice calls across telecom operators in India.

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Notably, incumbent telcos like Bharti Airtel, Vodafone India and Idea Cellular have been demanding for a higher IUC which would be double the existing IUC rate whereas new entrant Reliance Jio wants the IUC to be scrapped altogether. The existing IUC rate is 14 paise per minute whereas the incumbent telcos are demanding a higher IUC of 30-35 paise per minute.

Vodafone India during its IMG meeting said that IUC is already below cost, and any further cut in these inter-operator charges could hurt rural coverage. Idea Cellular had said that the government policy framework should allow telecom service providers to recover their costs, but said that it is completely in agreement that data prices need to come down, according to media reports.

Interconnect charges are the charges paid by one telecom operator to another when a call terminates on the other network. As of now, the charges for wireless calls are 14 paise per minute, however, Trai has agreed to review these charges upon insistence from stakeholders. Trai recently meeting major telecom companies for a workshop where the operators gave presentations on IUC followed by an open-house discussion on the matter. The telecom regulator is currently reviewing IUC and plans to conclude the long-drawn IUC review as soon as possible.