M A I N   N E W S

ADC cut to trigger fall in call rates
Tribune News Service

New Delhi, January 6
Consumers can look forward to another round of rate cuts in telephone tariffs with the Telecom Regulatory Authority of India (TRAI) today recommending a substantial reduction in the Access Deficit Charge (ADC) from February 1.

The Access Deficit Charge is a levy imposed upon private telecom operators which is paid to the state-owned service provider BSNL for funding its operations in rural areas.

Private players have gone on record saying they would pass on a part of the benefit of lower ADC to consumers in the form of lower tariffs.

Significantly, TRAI has reduced the ADC on incoming international calls to Rs 3.25 per minute and on outgoing international calls to Rs 2.50. The existing rate in these cases ar Rs 4.25 per minute.

Effectively, this would mean that private telecom operators would be in a position to reduce the international call tariffs by more than Re 1 per minute.

For domestic long-distance calls (STD calls), the intra-circle tariff (less than 50 km) is unlikely to change as no reduction has been advocated in the ADC in this regard.

However, for inter-circle rates, for distances above 50 km, the ADC has been fixed at 30 paise. The largest benefit is expected to accrue to those making calls beyond 200 km as the ADC has been reduced from the existing 80 paise to 30 paise.

Telecom conglomerate Bharti has said it will pass on the entire benefit of the ADC cut to the consumers after the new regime comes into force.

“The entire benefit of the cut in ADC rate would be passed on the customers,” Bharti chairman Sunil Mittal told newspersons today.

The BSNL, on the other hand, was more guarded in its opinion. “We have yet to see the full order of TRAI. But the assumption on which this reduction has been made should not affect the total quantum of ADC to us,” BSNL CMD A.K. Sinha said.

The new ADC regime, however, has kept the total amount of ADC funding unchanged. Presently, Rs 5,000 crore goes annually to the BSNL to meet rural telephony obligations.

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