The Hindu Business Line : DoT for retaining access deficit charges on incoming ISD calls

CONTRARY to the views of the telecom regulator, the Government is not in favour of reducing access deficit charges (ADC) on incoming international long-distance calls on the grounds that the move will increase tariffs for domestic telephone consumers.

In a note prepared for the Prime Minister's news conference slated for this weekend, the Department of Telecom (DoT) has said that any reduction in ADC on incoming international traffic would benefit only foreign carriers and not Indian consumers.

The Government is also pushing ahead with its decision to increase the foreign direct investment (FDI) cap in telecom from 49 per cent to 74 per cent.

The DoT note says that some precautionary steps are being worked out to address the security concerns associated with the proposal.

The Ministry of Home Affairs, the Department of Company Affairs, the Department of Industrial Policy & Promotion, and the Ministries of Finance, Defence and External Affairs are being consulted on the matter.

On the controversial ADC issue, the Telecom Regulatory Authority of India (TRAI) had proposed a reduction in charges on long-distance calls to curb the menace of the grey market.

The DoT has, however, said: "In case ADC is reduced or abolished on incoming international calls, then its benefit will not be passed on to the Indian consumers. It may, however, result in higher ADC on domestic long-distance traffic or hike in rental in semi-urban and rural areas adversely affecting the masses."

The TRAI, meanwhile, held a meeting with the telecom industry on Thursday to sort out the matter and has asked operators for more data.

Private operators are opposed to paying the charges on domestic calls on grounds that BSNL was misusing the money collected. While the operators threatened to stop ADC payments from September 10, the TRAI stuck to its stance during the meeting.

The DoT has, however, supported the TRAI's views on not doing away with the deficit charges for domestic calls.

The Department has said in the note that access charges could not be done away with because tariffs for fixed-line services are below costs in rural areas. The TRAI has imposed a levy in the form of ADC on national and international calls to subsidise rural telephony.

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DoT for retaining access deficit charges on incoming ISD calls