Government rules against raising fixed line rates

22 Aug 2006

The Indonesian government has opted not to raise charges for fixed line services, which would have taken effect from January 2007 under pre-agreed interconnection rate adjustments for the country’s telecom operators, due to concerns over the state of the economy. ‘Our economic condition is not that conducive. This is a result of the low purchasing power of the people and the recent natural disasters,’ said Gatot S Dewa, director general of post and telecommunications at the Communications and Information Ministry. The state is in the process of completing its recommendations for interconnection rate adjustments using data supplied by Telkom, Indosat and Telkomsel. The final list will be used as a blueprint for other operators wishing to interconnect with the three telcos or with each other. Under the government’s proposals, the cost of a fixed-to-fixed local call would rise from IDR250 (USD0.27) a minute to IDR314. However, the plan has been shelved because many Indonesians are already struggling to cope with high inflation and interest rates.