International termination charge (ITC) is the charge payable by an Indian International Long-Distance Operator (ILDO), who carries the call from outside the country, to the access provider in the country in whose network the call terminates.

The Telecom Regulatory Authority of India (TRAI) today issued “The Telecommunication Interconnection Usage Charges (Sixteenth Amendment) Regulations, 2020” which revise the present regime of fixed International Termination Charges (ITC) @ Re.0.30 per minute to forbearance regime within a prescribed range of Re. 0.35 per minute to Re. 0.65 per minute. To ensure the level playing field between standalone and integrated International Long-Distance Operators (ILDOs), the Authority is mandating that an Access Service provider shall offer the non-discriminatory rate of ITC to everyone i.e. to its own associated ILDO as well as to standalone ILDOs.

The development comes after TRAI issued a consultation on the international call termination charge in November last year.

The previous regime had come into effect on February 1, 2018, which revised the termination charge for international incoming call to 30 paise.

Telecom Regulatory Authority of India

Major Keywords to understand:

A. Interconnection

1. Interconnection means the commercial and technical arrangements under which service providers connect their equipment, networks and services to enable their customers to have access to the customers, services and networks of other service providers.

2. Interconnection is extremely important from a consumer’s perspective. Subscribers of different service providers or network operators cannot communicate with each other or avail the services they demand unless essential interconnection arrangements are in place. Commercial and technical arrangements must be made to facilitate interconnection between network operators. Several issues must be agreed upon by the operators or determined by the regulator in order to finalize these arrangements. Interconnection is one of the foundations of viable competition and is very much essential for orderly growth of the telecommunications sector.

B. Interconnection Usage Charge (IUC)

3. Interconnection Usage Charge (IUC) is one of the most important commercial issue for a successful interconnection arrangement. A brief description of the various components of IUC is explained underneath.

(1) Domestic Termination Charge

4. Domestic termination charge (DTC) is the charge payable by an access provider, whose subscriber originates the call, to the access service provider (ASP) in whose network the call terminates. In a Calling-Party-Pay (CPP) regime, the calling subscriber pays for the call to his access provider and the calling party’s access provider usually pays the termination charge to the called party’s access provider to cover the network usage cost.

(2) International Termination Charge

5. International termination charge (ITC) is the charge payable by an Indian International Long-Distance Operator (ILDO), who carries the call from outside the country, to the access provider in the country in whose network the call terminates.

(3) Transit Charge

6. When two telecom networks are not directly connected, an intermediate network is used through which calls are transmitted to the terminating network. Such an intermediate network is known as a transit network, and the charges to be paid to the transit network to cover the interconnection/network usage cost are called transit charges.

(4) Carriage Charges

7. Access providers in India can offer access services within the Licensed Service Areas (LSAs), also known as circles; the inter-circle traffic is required to be routed through a National Long-Distance Operator (NLDO). The charges to be paid by an access provider to the NLDO to cover the cost for carrying the inter-circle calls are called carriage charges.

(5) Origination Charges

8. The calling party’s access provider collects call charges from the calling party (i.e. the subscriber) as per the applicable tariff. From the amount so collected from the subscriber, the access provider has to pay termination charges to the called party’s access provider and carriage charges (in case of an inter-circle call) to the NLDO. The access provider retains the balance amount to cover the cost of originating the call. The amount so retained by the calling party’s access provider is called an origination charge. In India, origination charges have not been specified by the regulator and are under forbearance.

(6) International Settlement Charge

9. International settlement charges are the charges exchanged between foreign service providers and Indian ILDOs for exchanging international traffic. The international settlement charge includes international carriage charge, national carriage charge (if any), and the domestic termination charge. Keeping in view all these facts, the authority has decided that the rate of ITC shall be kept under forbearance within a prescribed range of Re. 0.35 per minute to Re. 0.65 per minute. As this new regulatory regime for the rate of ITC is being prescribed for the first time in the country, the Authority would closely monitor its implementation, including the trends and patterns of ILD voice traffic in the country. The Authority, if it deems necessary, may review this regime as well as the rate of ITC in due course of time.


DISCLAIMER: The article is based on the relevant provisions and as per the information existing at the time of the preparation. in no event i shall be liable for any direct and indirect result from this article. this is only a knowledge sharing initiative.

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Member Since: 12 Jun 2018 | Total Posts: 73
CS Deepak Seth is an Associate Member of Institute of Companies Secretaries of India having good experience in legal and secretarial matters. He is graduate from Delhi University and Post graduate from IGNOU University. He is also MBA in Finance and LLB Deree holder. He possesses professional experi View Full Profile

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December 2020