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India's older telcos Airtel, Vodafone and Idea, who have waged an acrimonious battle over local interconnect rates (IUC) against new entrant Reliance Jio, have found common ground with their bitter rival on the international settlement rates with both sides agreeing backing an increase.
The warring parties, in the midst of a brutal tariff war, are backing the increase of international termination rate (ITR) for calls coming into India from overseas, to Re 1 from present level of 53 paise a minute, saying that existing rates are very low for India when compared to global markets.
"In our submission, which was supported by all our members, including Relian ce Jio, COAI has asked for an increase from the present ITR," said Rajan Mathews, director general of Cellular Operators Association of India, which represents leading carriers in the country.
"This is due to the exchange rate differentials that have emerged for the INR versus other currencies and other related commercial and foreign regulatory factors which have created a net outflow of foreign currency from India due to traffic imbalances between incoming and outgoing international calls," he added.
The Telecom Regulatory Authority of India (Trai) is set to meet carriers to revi ew the international termination charge next week, and may ask operators to give a presentation on the global practices, factors affecting such rates and suggest suitable methods for deriving the international termination charges.
While the regulator started the exercise of reviewing the local and international charges together in August last year, it reduced the local interconnect charge to 6 paise last month from earlier rate of 14 paise a minute, and said it will phase out the charge completely by 2020.
It is yet to change regulation for international calls.
COAI has argued with the regulator that Indian telcos are paying a blended termination rate of `3.50 a minute for outgoing international calls but they get only 53 paise a minute for incoming calls, which was impacting profitability of carriers. It sought with Trai to bridge the huge gap in a phased manner.
According to data submitted to Trai, about 4.5 billion calls originate from India to overseas markets, while an astounding 88 billion calls land in India from other countries.
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