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Trai may revisit decision not to regulate tariffs: RS Sharma

Highlighting the change in the stance of the telcos, the Trai chairman said in 2017, when the operators were consulted, “all of them came to the conclusion that floor price is a bad idea, so regulatory intervention is not required.”

ET Bureau|
Dec 12, 2019, 11.40 PM IST
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RS Sharma
“It is only recently that the telecom companies have together written to us that regulate us, so it’s for the first time,” Telecom Regulatory Authority of India chairman RS Sharma said at an event on Thursday.
MUMBAI: The telecom regulator said it may reconsider its decision not to regulate tariffs, following requests from all operators, although it would ideally prefer to keep away from intervening in price plans.

“It is only recently that the telecom companies have together written to us that regulate us, so it’s for the first time,” Telecom Regulatory Authority of India chairman RS Sharma said at an event on Thursday.

“In 2012, I remember they had opposed tooth and nail the Trai’s proposal to regulate tariffs. They said tariffs must be left under forebearance.” The three private telcos - Reliance Jio Infocomm, Bharti Airtel and Vodafone Idea – had written to Trai through an industry association, urging it to set a floor price for data to improve the health of the sector, burdened by debt and additional liabilities in the form of statutory dues after India’s top court upheld a wider definition of adjusted gross revenue.

Highlighting the change in the stance of the telcos, the Trai chairman said in 2017, when the operators were consulted, “all of them came to the conclusion that floor price is a bad idea, so regulatory intervention is not required.”

“And again they have said a couple of weeks back, so we will have to consider what to do,” he said. “… ideally we would not like to put any regulation if the market is functioning in an efficient and fair manner – that is our broad principle. So, achieving the objective without doing anything is the best,” Sharma said.

The Cellular Operators Association of India informed Trai this month that all telcos are on board on regulating data prices.

“Bharti Airtel, Reliance Jio and Vodafone Idea are in complete agreement that Trai be requested to regulate tariffs by setting floor price for data services,” association director general Rajan S Mathews said in a letter to the regulator dated December 3, 2019. The telcos want call rates to remain unchanged.

Sharma reiterated on Thursday that the regulator’s duties are to ensure consumer protection, fair competition and growth. Trai intervenes only when operators request it to step in, he said.

“If there are certain market failures, if there are certain aberrations, if one of the objectives – for example, consumer protection – is not being met, then obviously we will have to think of ways to ensure that these objectives are met,” he said.

The sector is struggling with Rs 7 lakh crore of debt and the Supreme Court’s order of October requiring telecom licence holders to pay adjusted gross revenue dues of Rs 1.47 lakh crore. After the SC’s rulings, the three operators increased tariffs by up to 50% - for the first time since the entry of Jio in September 2016 triggered a price war.
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