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TRAI to review tariff plan. - Views on News from Equitymaster
 
 
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  • Mar 31, 2000

    TRAI to review tariff plan.

    The Telecom Regulatory Authority of India (TRAI) has decided to review implementation of the plan for re-balancing long distance tariffs through an increase in rentals and reduction in call charges for subscriber trunk dialing (STD) and international subscriber dialing (ISD)

    TRAI is basically a government body that has been set up to regulate telecom services and devise policies to monitor their functioning and growth.

    This review has been necessitated by a change in the revenue flows of the department of telecom services (DTS) and Mahanagar Telephone Nigam Ltd. (MTNL). DTS estimates that the net adverse impact on itís profits could be to the extent of Rs. 20 bn to Rs. 22 bn. This would have adversely affected DTS to finance itís expansion plans based on internal accruals

    This has also been done because the increase in rentals and the reduction in STD and ISD call charges were assessed to be too steep to be implemented in one phase. TRAI had some time back announced a nominal hike in rental charges backed with a steep reduction in STD and ISD charges.

    With more and more private players seeking to provide telecom services, the recent announcement comes as a shot in the arm for them, as they were equally concerned with Possible decline in revenues, especially given the huge investments required to be made by them for providing such services. This will also enable them to provide a better standard of services.

    It will also boost revenue for the government as it has significant stakes in both MTNL and DTS.

     

     

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