The government and the telecom regulator will not interfere or stop telecom companies from increasing prices, officials in the know told Economic Times. The tariffs in India are still among the cheapest in the world and authorities want the companies to ramp up their focus on quality of services, the officials said as per the report.
Read more: Bharti Airtel raises prices after Reliance Jio hikes: These are the new prices
"There is enough competition in the telecom sector and the situation is not critical that requires intervention of the authorities. Consumers may feel some pinch of the price rise, but the hike has happened after three years," one of the officials told ET.
Read more: Reliance shares can create up to $100 billion wealth, Morgan Stanley predicts. Should you invest?
This week, India's three private telecom companies raised mobile tariffs by 11-25%. This is likely to help the companies in spending on telecom services in urban India to 2.8% of household expenditures in fiscal 2025 from 2.7% in FY24. For rural households, it would go up to 4.7% from 4.5% but officials have called the increase "moderate".
Read more: Reliance Jio, Airtel price hike: What changes for you as new rates take effect
Axis Capital said in a note, “The analysis shows that the 13% (average) increase in tariff is moderate, and unlikely to have much of an impact on household expenditure. It also shows that even Jio's higher increase in tariffs and 5G monetisation are likely to be well absorbed by consumers.”
{{/usCountry}}Axis Capital said in a note, “The analysis shows that the 13% (average) increase in tariff is moderate, and unlikely to have much of an impact on household expenditure. It also shows that even Jio's higher increase in tariffs and 5G monetisation are likely to be well absorbed by consumers.”
{{/usCountry}}Meanwhile, a senior official in the Telecom Regulatory Authority of India (Trai) said as per the report, “There is a policy of forbearance in telecom tariffs and telcos are free to fix the tariffs. But they have to provide a good quality of service to consumers.”