Trai invites telcos to discuss floor price

Trai invites telcos to discuss floor price

Telecom Regulatory Authority of India (Trai) has convened the meeting of representatives of telecom service providers to discuss the issue of fixing floor prices for voice and data services, on July 21.


Trai also sought telecom firms opinion on floor pricing in written. In the meeting, the issue of fixing upper ceiling, if required, will also be deliberated, a senior official from Trai told DH.

Telecom tariffs are currently under forbearance, meaning that operators are only required to report their plans to Trai within seven days of launching them. However, there is no upper or lower ceiling, and the telecom regulator has only fixed a ceiling for tariffs during roaming.

Following the entry of new comer Reliance Jio with freebies, some of the telecom operators have suggested that Trai should fix floor prices to ensure the sector doesn’t plunge into crises.

Four major lenders, including SBI and HDFC Bank, during their recent meeting with a group of officials in the Department of Telecom had expressed concern over the growing debt in the telecom sector as it already crossed Rs 5 lakh crore.

Lenders have also apprehended about the possibility of default by the companies on their loan repayments unless corrective steps taken.

When Trai earlier convened the meeting of telecom companies representatives to discuss the sector’s financials, some companies like Idea suggested imposition of a minimum floor price for voice and data services.  

However, Reliance Jio said that financial stress in the telecom sector is mainly due to existing operators like Airtel and Idea investing in unrelated areas instead of focusing on telecom business.  However, the incumbent operators dismissed this, saying predatory pricing on Jio has dented the finance of the sector.
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