The Department of Telecommunications (DoT) responds to allegations from Congress regarding mobile tariff increases, asserting that the pricing is driven by market forces without government intervention.
In Short:
- DoT says mobile rates are market-driven, not regulated by the government.
- Airtel, Jio, and Vodafone Idea recently raised their tariff plans.
- Congress accuses the government of allowing telcos to increase tariffs without oversight.
- DoT defends tariff hikes, citing the need for investment in new technologies like 5G.
- The ministry highlights India's low mobile service costs globally.
On Friday, the Department of Telecommunications (DoT) addressed Congress's criticism of the recent mobile tariff hikes by telecom companies, clarifying that these rates are determined by market dynamics and that the government does not interfere in this process.
The controversy began when the three major telecom providers in India – Airtel, Jio, and Vodafone Idea – announced significant increases in their tariff plans, which took effect on July 3 and 4. The hikes saw Reliance Jio raising prices by an average of 20%, Vodafone Idea by 16%, and Airtel by 15%.
Congress accused Prime Minister Narendra Modi's administration of allowing these increases without any regulatory oversight, suggesting that this would unfairly burden India's 1.09 billion mobile users. They estimated this would impose an additional financial burden of about Rs. 35,000 crore on consumers.
In response, the DoT emphasized that the Telecom Regulatory Authority of India (TRAI) regulates mobile service rates and that the recent tariff hikes were the first in over two years. During this period, telecom companies have made significant investments in deploying 5G services.
The DoT labeled Congress’s claims as "misleading" and highlighted the importance of maintaining the financial health of the telecommunications sector to support ongoing advancements in technology, such as 5G, 6G, and IoT/M2M for Industry 4.0.
In a press statement, the Ministry of Communications reiterated that TRAI's long-standing policy of rate forbearance has resulted in India having some of the lowest mobile service costs globally.
Congress's Randeep Singh Surjewala questioned the timing of the tariff hikes, suggesting they were strategically implemented after the general elections to avoid public scrutiny. He also raised concerns about the lack of government or TRAI oversight in these unilateral price increases by the telecom companies, which collectively control about 92% of the market.
The DoT responded by noting that India's mobile services market is optimally structured with three private telecom service providers (TSPs) and one public TSP, ensuring competitive balance.
Comparing the current state of the telecom sector under the National Democratic Alliance (NDA) government to the previous United Progressive Alliance (UPA) administration, the DoT claimed that the sector had moved past previous controversies and a lack of transparency. They credited the NDA's progressive policies for substantial reductions in voice and data rates over the past decade and highlighted the significant non-tax revenue generated from transparent spectrum auctions.