Rediff.com Dec 9, 2004
Telecom Regulatory Authority of India said on Thursday that the current access deficit charge of 11 per cent must be brought down to lower the tariffs and enable the sector achieve higher mobile growth like China.
The ADC is paid by operators to Bharat Sanchar Nigam Ltd mainly to undertake rural telephony services and currently stands at Rs 5000 crore (Rs 50 billion) a year.
“Unless you bring down ADC from the current level, pushing growth in the mobile segment would be difficult. ADC must come down to introduce lower tariffs and unless tariffs go down further, the kind of growth happened in China will not happen in India”, TRAI chairman Pradip Baijal told newspersons in New Delhi.
“Last year, there were 13 million mobiles… Today there are 47 million. Obviously there is space for reducing ADC,” Baijal said, adding that with such volumes, margins are with the operators therefore the government and operators must work towards bringing down tariffs.
He, however, declined to quantify the reduction and said prejudging the cuts was not possible.
Asked whether the cut will be across the network or certain segments like national long distance, local or international, he said even today ADC is differential on different calls. Therefore the reduction will be differential on different calls, Baijal said.
The TRAI chairman also said that not just ADC, even Universal Service Obligation or USO and revenue share paid by operators to the government must also come down…