The government has clarified that recent tariff hikes by Reliance Jio, Airtel, and Vodafone Idea, effective July 3, 2024, are not unregulated. The Telecom Regulatory Authority of India (TRAI) oversees tariffs within a regulated framework, ensuring market forces dictate pricing.

 

Government's Position on Tariff Hikes

In response to claims of unregulated tariff increases, the government issued a press release denying these assertions. The release emphasized that the current mobile services market, which includes three private sector players and one public sector player, operates under the forces of demand and supply.

 

Official Statement: "The Government does not intervene in the free market decisions as the functionality is under the domain of TRAI and tariffs are under forbearance. Any change in the tariff of mobile services is notified by TSPs to the TRAI, which monitors that such changes are within the prescribed regulatory framework."

 

Impact of 5G Rollout

The press release highlighted the significant investments made by Telecom Service Providers (TSPs) in rolling out 5G services over the past two years. These investments have led to a substantial increase in median mobile speeds, reaching 100 Mbps. Consequently, India's international ranking in mobile speeds improved dramatically, jumping from 111th in October 2022 to 15th currently.

 

Future Investments and Industry Growth

The government stressed the importance of financial viability for the orderly growth of the telecommunication sector, which includes adopting the latest technologies like 5G, 6G, IoT/M2M for Industry 4.0.

 

TRAI Statement: "While protecting the interests of subscribers, for the orderly growth of the telecommunication sector, which includes investments in latest technologies like 5G, 6G, IoT/M2M for Industry 4.0, the financial viability of the sector is important."

 

Key Takeaways

  • Regulation: Tariff rates are regulated by TRAI, with changes monitored to ensure compliance with the regulatory framework.
  • 5G Investments: Significant investments in 5G have resulted in improved mobile speeds and elevated India’s international ranking.
  • Market Forces: Tariff rates are influenced by market demand and supply dynamics.
  • Financial Viability: Sustained investments in advanced technologies are crucial for the sector's growth and stability.

 

Conclusion

The government's clarification underscores that the recent tariff hikes by major telecom operators are within a regulated framework overseen by TRAI. The investments in 5G and other advanced technologies highlight the sector's commitment to enhancing service quality while maintaining financial health.