Promotional tariffs hurting govt revenue, restrict them to 90 days: Telecom Secretary tells TRAI
Outgoing Telecom Secretary JS Deepak has asked the Telecom Regulatory Authority of India (TRAI) to impose restrictions on the period of ‘promotional tariffs’ that telecom companies offer, saying that such offers have cost the government almost Rs 800 crore in revenue besides adversely affecting the industry.
“There appears to be an urgent need to revisit and review its tariff orders in the larger interest of the government revenues as well as the telecom sector,” Deepak has written in a letter to TRAI chairman RS Sharma, dated February 23.
The letter comes amid a tariff war among telcos following Reliance Jio’s entry which has extended its promotional offers well beyond the permissible limit of 90 days, exploiting loopholes.
Deepak, a 1982-batch IAS officer from Uttar Pradesh, was yesterday named India’s next Ambassador to the World Trade Organisation (WTO) from June this year.
The bureaucrat also mentioned in the letter that the government’s licence fee collection in the current financial year has fallen from Rs 3,975 crore in the June quarter to Rs 3,584 crore in the September quarter and Rs 3,186 crore in the December quarter.
Earlier, the Telecom Commission had pulled up the sectoral regulator for the poor health of the sector triggered by tariff wars, especially after Jio’s free voice and data services.
Since its launch, Jio doled out back-to back promotional offers - first the ‘Welcome Offer’ and then the ‘Happy New Year Offer’, giving free voice and data services.
The letter also points to TRAI guidelines, issued in 2002 and 2008, mentioning that promotional tariffs can be only offered to a mximum of 90 days.
It was time the regulator acted in both letter and spirit of its own directions, Deepak further wrote in the letter.