New tariff on hold to keep Mamata in fold

The announcement came in the wake of stiff opposition by several parties, including a major ally of the Bharatiya Janata Party-led coalition, the Trinamool Congress, whose members staged a walkout, resolving to boycott Parliament proceedings until the hike was withdrawn.

The TRAI order provided for a 40 per cent hike in rentals, a marginal hike in local call charges, and a nearly 50 per cent cut in domestic and international call charges. The new tariff was to take effect next Monday following a gazette notification, which was expectedthis week.

Earlier in the day, Jagmohan had assured the House that the government would take an “appropriate decision” on the tariff order.

He said the government did not want any section of society, especially the rural poor and lower middle class, to face “any undue hardship” on account of the new tariff order.

Jagmohan promised the House that the government would give due respect to the recommendations of the parliamentary standing committee on communications which had argued against an increase in telephone call charges.

Congress member Rajesh Pilot, who had raised the issue, said the hike would “badly hit” the rural poor since 80 per cent of rural phones were “always dead.” “There should be a balance in tariffs in rural and urban areas,” he said.

TRAI framed the new tariff order with a view to removing the cross-subsidy offered to some users and rationalising the tariff structure based on the usage pattern and exchange capacity.

The authority had come out with a consultation paperin September last year and discussed the proposed tariff with operators, government bodies and consumers.

The order provides for a 39 per cent rental hike in urban areas and a 40 per cent increase in rural areas in the first year of implementation. However, local call charges were rationalised on the basis of usage patterns.

Long-distance call charges were made less costlier with the tariff coming down gradually during the three years of execution beginning April 1999.

TRAI was set up in 1997 after the government framed the Telecom Regulatory Authority Act with the idea of having a strong market regulator.