Policies are aimed at promoting competition and lower tariffs that benefit consumers, says TRAI

Telecom Regulatory Authority of India (TRAI) on Thursday has finally refused the Telecom Commission's (TC) contention that reduced mobile tariff by the operators is reducing revenues for the government by saying policies are aimed at promoting competition and lower tariffs that benefit consumers.

TRAI on Thursday has finally refused the Telecom Commission's (TC) contention that reduced mobile tariff by operators is increasing the loss of revenues for the Government by saying its policies are aimed at promoting competition and lower tariffs that benefit consumers.

While giving a reply to TC, TRAI said that the economic purpose of telecom regulation is to maximize the overall economic growth of the sector and increase productivity.

It further said that tariff and impact on government revenue also need to be seen in the larger context of Digital India programme and affordable data connectivity.

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The regulator said that "The Authority would like to inform you that the tariff regulatory regime established by TRAI since 1999 has promoted competition in the sector and has facilitated all TSPs including new entrants in the sector to offer competitive tariff to their consumers."

TRAI also said that its recommendation on reforms like reducing the license fee from 8 percent to 6 percent, making SUC flat to 3 percent to 1 percent and to increase the duration of deferred payment spectrum amount to 20 years from the current 10 years were not implemented by the Telecom Ministry are the reason to be blamed for the health of the industry and hence for declining revenues of the government.

In February, TC has directed the regulator to implement orders on tariffs in "letter and spirit" and review existing rules to ensure the financial growth of the telecom industry.

The commission discussed the decline in revenue of telecom industry in the second and third quarter. This is the first time revenue of the sector has declined.The commission has decided that TRAI may be apprised of commission's concern and implement its own order and direction on tariffs in letter and spirit and also review existing rules for the orderly financial growth of the sector.

Similarly, former Telecom Secretary JS Deepak has also written a letter to the regulator asking it to restrict the period of 'promotional offers' by telecom players, as the government loses Rs. 800 crore revenues.