The Telecom Regulatory Authority of India (TRAI) has slashed the international call termination charges (ITC) payable by international long distance operators to just 30 paise/min – effective from February 1, this year.

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The international call termination charges aka ITC is the amount payed by international operators to the local network operators which receive the calls for using their network and resources. Now the current ITC prices are 53 paise per minute, however, as per the revision announced by TRAI on Friday, the new ITC rates will be just 30 paise per minute, that is a slash down by 43%. TRAI authorities, while announcing the revision plan said that it was aimed to stymie the ‘menace’ of grey route of international calling which it said also posed a ‘serious threat’ to national security. The grey route here is the over-the-top (OTT) international calls from apps like Whatsapp, Viber and Skype to make calls over internet.

The TRAI said, “Arbitrage opportunity between ITC and domestic call tariffs would become so insignificant that illegal voice over internet protocol (VoIP) gateway business in India would become unviable; in turn, the grey market for ILD (international calls) incoming traffic would eventually cease to exist.” The new rates will be effective from February 1, 2018 and then the plan is to monitor the effectiveness of the change on incoming international calls and the prices may be changed as per need from time to time. But it necessarily doesn’t indicate that the prices of international calling might change, yes, it might change for the callers from other countries, but that depends on their network operator who will ultimately benefited from this change.

However, this revision means it will hurt the revenues of Indian telecom operators as it will cut down their ITC revenues by 43% amid brutal price war. As of now, local telecom companies like Bharti Airtel, Vodafone India and Idea Cellular collectively generate a revenue of about Rs 5000 crores annually, just from ITC charges. It will also negatively affect India’s precious foreign exchange resources and is expected to beat the Indian telecom companies with a loss of Rs 2000 crores annually. The telecom operators have already requested the TRAI to withdraw this decision as it would lead to massive loss of revenues; however, the request was not backed by just one Indian telco – Reliance Jio.

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