Reliance Communications hikes call tariffs by 25 percent

Reliance Communications has hiked its base rate for local calls by 25 percent in the telecom zones of Bihar, Madhya Pradesh, Gujarat and Himachal Pradesh. An official statement from Reliance Communications states, "RCOM has increased the base tariff by 25 percent to 1.5 paisa per second from 1.2 paisa per second as the competitive intensity tapers off and input costs rise.” 

New rates to get uniform across the nation in a month

The new tariff will be rolled out across the country in the next 30 days. Shedding some more light on the plans behind the hike, the company statement read, “The move will help improve top line revenue and operative margins per user”.

In April this year, Idea Cellular increased its calling tariffs for existing prepaid subscribers to 1.3 paisa per second from 1.2 paisa in Madhya Pradesh and Chhattisgarh. At that time, it was reported that the same tariff could be extended to other circles too. Idea offers a Rs 3 voucher, which would shift the customer to the tariff of 1.3 paisa per second, instead of 1.2 paisa for local and STD calls, and 1.5 paisa per second for fixed line calls.

Last month, reports had indicated that mobile call rates would go up by 30 paisa per minute. The telecom industry stated that a hike in tariffs is imminent, as a result of a rather disappointing decision by the Cabinet to keep the base price of the spectrum fixed at Rs 14,000 crore. The industry added that the decision would prove to be "regressive" for the sector's growth, and that it would force operators to hike tariffs. Reports further quoted the Cellular Operators Association of India (COAI) as saying, "It will continue to have an impact on the tariffs to the extent of about 30 paisa per minute. The effect on finances is that an amount of Rs 3,20,000 crore of additional debt that will have to be laid on the industry".

The figures that the Telecom Regulatory Authority of India (TRAI) released as part of its ‘Monthly Highlights on Telecom Subscription Data as on 31st July 2012’, revealed that the number of telephone subscribers in the country has declined. According to the report, the number of telephone subscribers in India fell to 944.81 million at the end of July 2012, registering a negative growth rate of -2.14 percent. TRAI attributed the decline to large scale disconnections by a host of service providers.