Sunil Mittal wants IUC regime to continue

Mittal writes to Trai against bill-and-keep pricing

Bharti Enterprises Chairman Sunil Mittal has asked the Telecom Regulatory Authority of India not to follow the bill-and-keep method of pricing calls, as proposed by Mukesh Ambani-owned Reliance Jio and Anil Ambani-owned Reliance Communications.  

In a letter to Trai Chairman R S Sharma, Mittal said interconnect usage charges were a time-tested principle and the regulators of most countries ensured telecom operators were compensated for their investments. “Why should India be any different? Trai’s own regulations enshrine the principle of cost-based IUC in line with global practices,” Mittal said in the letter.    

He said even for data, telecom companies paid for bandwidth to interconnect to the Internet and towers for radio base stations and for “each one of these services they settle payment, which is no different from paying the other operators for carrying their domestic calls”.

Raising the issue of IUC for international calls, Mittal said the IUC for a call from India to the US was about 1.2 cents, to Europe 3-30 cents, to the Middle East 10-14 cents, and neighboring countries like Bangladesh, Sri Lanka, and Nepal 2-13 cents. Similarly, he said, for incoming calls to India, Trai had set an IUC of 53 paise. 

“This confirms the authority’s acceptance of the principle of IUC is indeed a settled global practice built on fair and equitable settlements,” Mittal added.

“I am at a loss as to why Trai should be considering bill-and-keep and break away from the global practice,” Mittal said.

Trai recently concluded open house discussions on IUC, in which several participants supported bill-and-keep. Reliance Jio made a presentation to Trai alleging a windfall of over Rs 1 lakh crore to incumbent operators due to non-implementation of bill-and-keep. Mittal also said customers enjoying free calls was testimony that the IUC regime was not coming in the way of affordable tariffs.

“The current IUC at 14 paise is well below cost and it will be in the fitness of things that the IUC is set at costs discovered through a fair and transparent mechanism,” Mittal added.