Experts discuss if reduction in IUC by TRAI is justifiable or not

Last week, the Telecom Authority of India (TRAI) slashed the interconnect usage charge (IUC) on mobile to mobile calls by more than fifty percent to six paise per minute. IUC is the amount paid by one telecom operator to another for facilitating voice calls for its customers.

The new rate will come into force from October 1. The incumbent telcos such as Bharti Airtel, Vodafone and Idea Cellular are crying foul terming the move disappointing, retrograde and non-transparent. Reliance Jio says the move to a zero IUC regime will benefit customers and drive the consumption of mobile services.

So, will the new IUC rate exacerbate problems for the incumbent telecom sector that is already reeling from a massive debt burden or is the telecom regulator justified in asking for an over fifty percent cut in the IUC rate.

In an interview with CNBC-TV18 eminent guests UK Srivastava, Principal Adviser- Network Spectrum and Licensing, TRAI, Rajan Mathews, Director General, Cellular Operators Association of India, Sanjay Kapoor, Former CEO, Bharti Airtel and SS Sirohi, former member, Telecom Commission discuss the arguments both for and against reduction in IUC.