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`STD charges will come down'

Our Bureau

NEW DELHI, Aug. 13

THE days when you will not have to keep an eye on the meter while making an STD (national long distance) call are not far.

With the Government permitting private players to offer NLD telephony _ only the State-run Department of Telecom Services (DTS) offers such services now _ STD tariffs are expected to fall to 20 per cent of what it is today within the next five years.

The Union Communications Minister, Mr. Ram Vilas Paswan, said the Government's move was aimed at bringing down domestic call tariffs, while also increasing competition in the sector which now witnesses State monopoly. The decision is based on the provisi ons of the New Telecom Policy-99, he added.

But tariff rebalancing is a contentious issue. The first round of tariff rebalancing, whereby STD charges were slashed last year, has had an effect on the profitability of the incumbent. Mr. Shyamal Ghosh, Secretary, Department of Telecommunications (DoT ), today said that reduction in tariffs will be done in the interest of the nation.

The announcement will lead to major domestic players such as Bharti, Reliance, the Tatas, MTNL and BPL, among others, entering NLD operations with huge investments expected to be as high as Rs. 2,000 crores per player. Singapore Telecom (SingTel) has alr eady announced plans to team up with Bharti, while other players such as British Telecom, Vivendi, AT&T etc, are expected to disclose their plans within this quarter.

Infrastructure companies will make additional investments for dark fibres, right of way, and for acquisition, sale and leasing of bandwidth capacity.

Indicating the positive response of the industry to the Government initiative, Mr. Mahendra Nahata, Chairman of the HFCL group, said his company will also draw up business plans to assess if an entry into NLD will be a viable option. ``We have not discus sed with any foreign company yet. But I think there is a huge potential,'' he said, adding that there will be availability of adequate bandwidth and STD rates will fall to almost 20-25 per cent of today's rates within five years or even earlier.

Agrees Mr. S. Sundresan, Director (Finance) of MTNL (State-owned basic operator in Delhi and Mumbai), which has firmed up plans to foray NLDO, with a minimum Rs. 1,000-crore investment. ``STD charges will fall. The first round of tariff rebalancing had a n impact on us. But in a competitive environment, this is expected. We will assess the situation prior firming up any definitive proposal in association with foreign player(s),'' he said.

On the issue of allowing intra-circle traffic to NLD players, which requires an agreement with the fixed service providers (FSPs), MTNL, an FSP for Mumbai and Delhi, said this was an issue which will have to be studied carefully. It also depends on the t erms and conditions of the agreement.

A Reliance Telecom official said that plans are being drawn up for creating the infrastructure for NLD services. The Indian telecom sector will get a major push from today's announcement, he added.

Telecom analysts and consumer rights activists, however, warned that the Government now needs to be extra cautious in ensuring network roll-out obligations to reach the benefits of telecom technology to the masses.

``The monopoly of the Government will end, and it is expected that DTS' profitability will be affected. In this scenario, will the private operators provide services in the rural areas? They have failed to fulfill their obligations as far as basic servic es are concerned,'' a representative of a telecom consumer forum said.