The Hindu Business Line : BSNL contests TRAI move on ADC

Cross talk
`Decision to cut ADC is arbitrary and illegal. We want to know the rationale for such a stance. The number of rural telephone lines that BSNL is offering has not changed; why is the amount given to us to subsidise these connections being reduced,' asks a BSNL official.

New Delhi , March 31

There is fresh storm brewing over Access Deficit Charge (ADC) that can potentially force a roll-back of all tariff cuts in the telecom sector announced since March 1.

The state-owned Bharat Sanchar Nigam Ltd has filed an appeal in the Telecom Dispute Settlement Appellate Tribunal (TDSAT) against the revised ADC regime introduced by the Telecom Regulatory Authority of India (TRAI), on the grounds that the proposed amount collected from the charges was inadequate to support 1.4 crore fixed line telephone connections in the rural areas. The BSNL move comes despite assurances given by the Communications Ministry earlier that the public sector company had accounted for the reduction in charges and was, therefore, geared up for it. The appeal was filed by BSNL early this week.

The telecom regulator had introduced the new ADC regime from March 1, which was responsible in bringing down the total kitty from Rs 5,200 crore to just over Rs 3,000 crore. Though the move enabled operators to bring down long distance tariffs by 60 per cent and introduce One India tariffs, it resulted in a loss of Rs 1,800 crore to BSNL. Ninety per cent of the amount collected through the ADC accrues to BSNL since it has the largest rural network in the country.

BSNL officials said that the reduction in the amount was arbitrary and illegal. "TRAI has said that the ADC is depleting regime. We want to know the rationale for taking such a stance. The number of rural telephone lines that BSNL is offering has not changed, so why is the amount given to us to subsidise these connections being reduced. In fact, we should be getting Rs 13,000 crore as was decided by TRAI in the first place," said a BSNL official.

BSNL has also raised questions over the decision to merge ADC with the Universal Services Obligation (USO) Fund over the next few years. "USO Fund is under the Department of Telecom, so how can TRAI take such a decision. The Government needs to decide on that front before TRAI can make such decision," said a BSNL source.

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