Operators unhappy with ADC changes

7 Jan 2005

India’s telecoms industry has responded negatively to the regulator’s decision to lower the access deficit charges (ADCs) which are levied on incoming calls. While operators admit that the reductions will benefit consumers thanks to cheaper call charges, they say that they themselves will gain nothing. The Telecom Regulatory Authority of India (TRAI) has scrapped the existing ADC structure which levied charges of between INR0.30 and INR0.80 on calls depending on distance, and replaced it with a flat fee of INR0.30 per call. In addition, the ADC for international calls has been cut from INR4.25 to INR3.25. Operators say this benefits international carriers while private Indian companies lose out. The TRAI says that though ADCs have been reduced, the income going forward from the charges will be roughly the same due to rising subscriber numbers. ADCs raise around INR50 billion annually, the bulk of which goes towards subsidising the unprofitable rural networks of fixed line operator BSNL.