TRAI eases way for cheaper STD, ISD calls

YOUR CALL: Trai has decided to phase out ADC as a percentage of AGR from April 1.

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Keywords: Trai, Calls

New Delhi: Your telephone calls have just got cheaper. The Access Deficit Charge (ADC) on all domestic calls has been phased out with effect from April 1.

The levy called ADC is being paid by the telecom service providers to compensate BSNL for offering rural services, which were considered unprofitable.

However, BSNL has been advocating for continuation of this levy. It was getting the ADC of Rs 5,000 crore annually till about two years ago from private players to compensate the PSU for providing services in rural areas, where private companies were reluctant to go.

Bharti has already said it will pass on the benefit, and cut call rates. ADC on international calls has also been cut by 50 per cent.

“Private operators should not be asked to fund BSNL's expansion plans under any circumstances," said a private cellular operator.

"The TRAI had itself said in its consultation paper that ADC was not required any more. It had given mathematical calculations to justify the end of the regime. We don't think there is any rationale to subsidies rural telephony any more as operators are themselves rolling out services in these areas.”

The ADC has two parts. First is 0.75 per cent of Adjusted Gross Revenue (AGR) that service providers pay to BSNL and second, Re 1 per minute on international incoming calls paid to the PSU by international long distance service providers.

The regulatory body has issued the ninth amendment to the Interconnection Usage Charges (IUC) regulation that deals, among other things, with the ADC payable by private operators.

Through the amendment, Trai has decided to phase out ADC as a percentage of AGR from April 1, 2008, making all domestic calls free from the incidence of ADC from that date.

(With agency inputs)