Whalesbook
### The Call for Recalibration: A Strategic Imperative
Indian telecom operators are escalating their efforts to secure a significant revision of international incoming call termination charges (ITC), proposing a substantial increase from the current ₹0.65 per minute to ₹4-5 per minute. This strategic move is fueled by escalating concerns that the existing regime is not only misaligned with global standards but is increasingly being exploited for sophisticated international telecom fraud and spamming operations. Industry executives highlight that the current low termination charge has inadvertently created an economically viable pathway for overseas entities to route high volumes of fraudulent traffic into India, including phishing calls and robo-calls.
Data from the Telecom Regulatory Authority of India (TRAI) in November 2025 revealed a stark imbalance in FY25, with incoming call volumes at 11.17 billion minutes compared to only 0.72 billion minutes for outgoing calls. Despite this volume disparity, the financial outcome was strained; Indian telcos paid an estimated ₹252 crore to foreign carriers for outgoing calls while earning ₹723 crore from incoming traffic, a ratio far less advantageous than the call volume suggests. Operators have invested heavily in anti-spam technologies, but these efforts are undermined when international traffic can enter the country at negligible cost. Raising the ITC is therefore positioned as a critical deterrent, increasing the cost of misuse for malicious actors originating from abroad.
### Global Benchmarks and Financial Headwinds
The industry's advocacy for higher ITC rates is bolstered by global precedents. Several countries, including the UK, China, Nigeria, Turkey, and Sudan, have elevated their international termination charges in recent years, creating a pricing anomaly where India's rates lag significantly. For instance, while specific rates vary, UK mobile termination rates have been regulated as low as 0.5 pence per minute (approximately ₹0.50), with proposals for further reductions. Other regions show higher rates, with international voice termination to Bangladesh at 1.5 US cents per minute. India's static rates allow international aggregators to route calls at artificially low prices, capturing substantial margins.
Beyond security concerns, the current imbalance poses direct financial risks. Outgoing international call charges are often denominated in dollars, exposing Indian operators to currency depreciation. As the rupee weakens, the cost burden for these outbound calls increases, creating a structurally disadvantageous position for domestic networks that maintain extensive infrastructure. While the Indian telecom sector's gross revenue reached approximately $40 billion in FY24 and is projected for growth, this underlying revenue leakage from ITC represents a significant inefficiency.
### Towards a Balanced Ecosystem: Regulatory and Consumer Outlook
International termination charges form part of the Adjusted Gross Revenue (AGR), a key component for calculating government licence fees. An increase in ITC would thus translate into higher revenue collections for the exchequer, offering a fiscal benefit. Crucially, operators emphasize that this proposed hike is not expected to be passed on to domestic consumers. The charge is borne by foreign carriers and international aggregators, meaning consumers in India should see no adverse impact on their calling rates. This aligns with TRAI's mandate to protect consumer interests while ensuring the financial health and security of the telecom ecosystem. Historically, TRAI has adjusted these rates; for instance, international incoming call termination rates were increased to ₹0.53 per minute in 2018 from ₹0.40. The current push represents a significant escalation from that level, reflecting the growing scale of fraud and economic disparity.
The broader context shows the global telecom industry grappling with escalating fraud, with estimated losses of $38.95 billion in 2023, a 12% rise since 2021. The operators' proposal, therefore, is not merely a tariff adjustment but a strategic defense mechanism against evolving international threats. Major players like Bharti Airtel (with a P/E of ~38 in early 2026) and Reliance Industries (P/E ~22) operate within a sector projected to grow earnings by 15% annually, but this growth is contingent on a stable and secure operational environment.