TRAI cuts roaming charges

Being in touch with people when moving out of town will become cheaper. The Telecom Regulatory Authority of India (TRAI) has slashed all roaming charges by up to 56 per cent.

This will mean that from February 15, if you are using your mobile phone while going out of town, mobile operators can only charge a maximum of Rs 2.40 per minute.

However, roaming charge floor price has been fixed at Rs 1.40 per minute and all incoming SMSes will be free of cost.

At present, service providers charge a maximum of Rs 3.99 per minute for receiving incoming calls while roaming and Rs 3.09 per minute for outgoing local calls.

Rental charges

Also, the rental for using roaming services has been done away with and incoming SMS would be free while roaming.

A surcharge of 15 per cent on air-time while roaming and a separate PSTN charge have also been done away with.

"TRAI would closely monitor market developments on roaming and if perceptible competition evolves in the market, it would revisit the issue and even consider forbearing roaming tariffs," said Nripendra Misra, Chairman, TRAI.

The new tariff would be applicable to all prepaid and postpaid GSM and CDMA mobile customers.

Impact on telcos

However, telecom companies could lose between Rs 800 to Rs 900 crore from these rate cuts and stocks like Bharti Airtel and Reliance Communications slid on the markets on Wednesday.

The impact on Bharti and Hutch, which have more roaming users is expected to be more.

A Reliance Communication spokesperson told that the impact on his company would be negligible because they have very few users on roaming.

The telecom companies might be unhappy but telecom minister Dayanidhi Maran was all praise for TRAI.

It's not all bad news for the telecom operators. TRAI has made it clear that if the operators continue to provide roaming below the ceiling set by TRAI.

The regulator might allow market forces to set the roaming tariffs and not get involved with setting these tariffs anymore.