The Telecom Regulatory Authority of India (TRAI) has slashed local termination rates by a third in a move seen as beneficial to new Indian mobile operators such as Unitech Wireless, Swan Telecom and Datacom. The regulator announced yesterday that interconnection charges for all domestic calls – fixed to fixed, fixed to mobile, mobile to fixed and mobile to mobile – will be reduced from INR0.30 to INR0.20 per minute effective from next month. However, the incoming termination rate for international calls is to be raised INR0.10 to INR0.40 per minute in a move designed to encourage operators to pass on lower tariffs for outgoing international calls by allowing them to make more revenue from foreign operators. The current ceiling for domestic long distance calls remains unchanged at INR0.65 per minute. “Keeping this ceiling unchanged will encourage national long distance operators to expand infrastructure into rural areas,” TRAI said in a statement. The new rates will apply to voice calls on both 2G and India’s forthcoming 3G networks.

According to local press reports, the country’s mobile operators have mixed views on the new regulations. Economic Times reports that GSM operators such as Bharti Airtel, Vodafone Essar and Idea Cellular have voiced concerns that the decision to cut national rates by a third will hit revenues, while CDMA operators have welcomed the moves as the majority of their customers are deemed to be low-end users that receive more calls than they make. Meanwhile, according to Business Standard, new players such as Unitech and Swan had demanded that rates fall further, to as little as INR0.00 to INR0.10 per minute.