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No justification for hike in mobile tariffs: TRAI

TRAI said its calculations showed there was no justification for an upward revision in call charges.

business Updated: Feb 02, 2004 15:13 IST

Telecom Regulatory Authority of India (TRAI) on Monday flayed the action of cellular operators to hike tariffs following the implementation of new IUC regime, saying its own calculations showed there was no justification for an upward revision in call charges.

"The operators are citing access deficit charge (ADC) as the reason for increasing tariffs...It is a poor excuse. We did our calculations and there is enough margin available for not increasing tariffs," TRAI member DPS Seth told PTI.

Asked if the regulator would intervene on the issue of hike in rates, he said: "There is a forbearance on tariffs and so let the competition bring it down."

He, however, said the regulator would have to "examine" the issue. "We will have to examine it once the tariff information comes to TRAI," Seth pointed out.

With the implementation of the new Interconnnect Usage Charges (IUC) regime from February 1, mobile operators have started hiking tariff rates by up to 50 per cent, especially long distance charges.

The post-paid cell-to-cell STD rates are expected to increase by 50 per cent to Rs 2.99 per minute from Rs 1.99 in case of calls over 200 km, although charges for distance up to 200 km will remain unchanged at Rs 1.99.

For pre-paid customers, the cell-to-cell STD charges are expected to increase to Rs 2.99 from Rs 2.40 for all distances.

According to industry sources, the hike in charges for cell-to-fixed line STD would range from 25-50 per cent depending on the distance.

Seth said TRAI's calculations showed that ADC component, after being applied, could not lead to hike in the charges.

While Bharti has already implemented the tariff hikes from February 1, others are expected to follow suit soon.

In the case of a local call by post-paid subscribers, the cell-to-fixed lines charges have increased to Rs 2.49 from Rs 1.99. The rates have been increased proportionately in different packages. There is no change in cell-to-cell calls in this category.

First Published: Feb 02, 2004 15:10 IST