Tariffs for ISD might come down

Telecom tariffs have stopped declining on a broader level, but there is scope for rationalisation in ISD charges.

According to sources, the Telecom Regulatory Authority of India (TRAI) has started reviewing charges paid by International Long Distance Operators (ILDOs) and Internet Service Providers (ISPs) to Cable Landing Stations (CLS) in India for landing international capacities on Indias shores.

A decline in the tariffs for consumers using ISD services as well as for a slew of sectors - ITEs /BPO/KPO, call centres, banks, small and medium enterprises and ISPs using bulk international bandwidth - may be on the cards. Lower charges could take effect as early as in the next two months. The new charges are expected to be market-based and its main beneficiaries will be the average international caller and the ITEs/BPO sectors.

As of now, there is no standard single tariff for international calls, since it is dependent on the operator, the package and the country and time of calling. The charges under review will be governed by TRAI's International Telecommunication Access to Essential Facilities at Cable Landing Station Regulations of 2007. These regulations provided for a minimum commitment of a period of three years, which has now expired.

Experts believe, that the current review by TRAI is timely as some of the charges being levied in India are higher, in comparison with Southeast Asian economies, which are the biggest competitor for India for the global low-cost ITEs, BPO/ KPO/call centre business. There exists enough evidence to suggest that a large amount of India's business is rapidly moving to countries like Indonesia and the Philippines, where costs are lower.

Currently, a large number of submarine cable-based international consortiums like SMW4, SMW3, TIC and Falcon provide international bandwidth to Indian ILD service providers. These submarine cables terminate at cable landing stations, which are operated and managed by a handful of Indian companies, namely, Tata, Bharti, Reliance and BSNL.

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