New Delhi: All the major telecom companies cut their national roaming tariffs on Thursday, following an April order by the telecom regulator.

Telecom Regulatory Authority of India (Trai) on 10 April issued an order that telcos can charge customers a maximum of 80 paise a minute for making calls, and 25 paise to send a text message, when mobile phone users visit a place outside their home network within India.

The new order is to come into effect on Friday, two days before the deadline for national number portability to be implemented in the country comes into effect.

“On roaming, for all outgoing local calls, a ceiling of 80 paise/minute has been fixed from the earlier 1/min, and for STD calls it is 1.15/min from earlier 1.5/min. For incoming calls on roaming, a ceiling of 45 paise/minute has been fixed from the earlier 75 paise/minute," Vodafone India Ltd, the country’s second-largest telco, announced on Thursday.

Similarly, Idea Cellular Ltd said it will “now offer incoming calls at just 45 paise/minute, a reduction of 40%, while roaming anywhere in India."

“Outgoing local call rates have been reduced by 20% and STD call rates by 23%. Local SMS will now be available for just 25 paise and STD SMS for just 38 paise, on roaming nationally. The revised tariffs will be applicable starting 1st May 2015 for all Idea prepaid and postpaid users across the country," the Mumbai-based telco said in a statement.

Bharti Airtel Ltd, India’s largest telco, also reduced national roaming rates along similar lines with cuts ranging from 20-75%, depending on the service. A similar statement was also issued by Reliance Communications Ltd.

Trai last reviewed the tariff ceiling in June 2013. In March, the telcos lobbied the regulator to refrain from cutting the tariff ceiling as their books were under tremendous pressure after the spectrum auction that concluded on 25 March. The telcos have placed bids totalling as much as 1.1 trillion, the highest ever for the India government from such a sale.

By 3 May, telcos will also have to provide their subscribers with the option to port or move to another network provider without having to change their mobile number, even if the subscriber moves to another circle.

Analysts expressed concern over the reduced tariff and its impact on telcos’ balance sheets.

“These ceiling tariffs are good for the consumer but would impact the profitability of telcos given the high price they have to pay for spectrum and other high costs of new technology rollout and government levies. Revenue from SMS was reducing anyway due to messenger apps and these new ceilings would further hit the telcos’ revenue from roaming SMS," said Hemant Joshi, a partner at Deloitte Haskins & Sells Llp.

Roaming accounts for approximately 6% (around 8,000 crore) of industry revenue, according to a March report by Sunil Tirumalai and Chunky Shah, analysts with Credit Suisse Securities Research and Analytics.

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