Telecom firms oppose OneIndia tariff plan

By agencies   |   Friday, 26 August 2005, 07:00 Hrs
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NEW DELHI: The Government's plan to introduce a uniform telephone call rate across the country has hit a block with telecom service providers opposing the move.

Cellular operators and basic operators have written to the Department of Telecom (DoT) expressing reservations against the Government intervening in tariff regulation, stating that such a move could be counter-productive with an increase in local calling tariffs. Dayanidhi Maran, Minister for Communication and IT, had mooted the proposal.

"We endorse the view that it may not be desirable to merge local call and long-distance rates and have a single all-India tariff, " said the Cellular Operators Association of India (COAI).

"A single rate for intra- and inter-circle calls would mean higher intra-circle call rates in order to reduce the inter-circle rates. This would mean that local calls will subsidies long-distance calls. This would not only be contrary to well-accepted practice but also unfairly penalize and antagonize local call consumers. Long-distance cannot be brought down to the level of local call tariffs as this would be financially unfeasible and make the operations totally unviable." The Association of Unified Services Providers of India (AUSPI) said that already market forces are bringing down per minute long-distance call charges to below Re 1; therefore, the Government need not regulate the tariffs.

The industry body representing CDMA operators such as Reliance Infocomm and Tata Teleservices said that the Government should instead focus on bringing down the cost burden on operators, which would help in lowering the tariffs automatically.

"OneIndia can be achieved through promotion of healthy competition with a little help in the form of incentives rather than the Government intervention to drop tariffs," AUSPI said in its communication to the DoT. The telecom operators had met DoT officials on August 16 in this regard.

The operators have also said that the Government should bring out a paper on the proposed tariff regime explaining the modalities of the OneIndia plan. "We request that the Government may kindly provide us a position paper on this concept which would give us a clear understanding on the subject and will allow us to provide a more comprehensive response in this matter," the two associations said.

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