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Friday, 8 February, 2002, 11:18 GMT
India call charges set to halve
RPG Cellular Services webgrab
India's telecoms market is growing fast
Telephone charges for calls out of India are set to fall by up to 50% when the market is liberalised on 1 April, according to a US telecoms operator planning to enter the market.

This will allow both internet service providers and telecoms companies to compete head-on with the recently privatised monopoly carrier, VSNL.

International calls from India are among the highest in the world and should fall by between 40% and 50%, said the US telecoms operator ITXC.

The company plans to enter the market by offering web-based telephone calls via the internet service provider Data Access India, a subsidiary of Hong Kong's Pacific Century Cyberworks.

Under pressure

It is already happening in the national market where a private player earlier this month punctured inflated domestic long distance charges simply by announcing its presence.

US Secretary of State, Colin Powell, talks with Indian Foreign Minister Jaswant Singh
Calls from the US to India cost one-third of a call the other way
Long distance calls within India suddenly fell 62%.

VSNL's grip on the $1.5bn (1bn) a year international calls market is set to weaken, a consultant's research report forecast.

Its market share will dwindle by about half by 2004, Crisil Advisory Services and PA Consulting group predicted last month.

Growing market

At about $1 a minute, it is more than three times more expensive to call the US from India than it is to call India from the US.

The imbalance in costs means there are about four times as many calls going into India as there are outgoing calls.

Extensive demand for international calls should help fulfil the government's vision of growing the market by about 200% by 2010.

This would make it the fastest growing telecoms market in the world this decade.

See also:

07 Feb 02 | Business
India targets renewed investment
06 Feb 02 | Business
India shares surge after sell-offs
05 Feb 02 | Business
Boost to India privatisation
05 Feb 02 | Business
Slow growth threatens India's poor
30 Jan 02 | Business
India slashes overseas phone bills
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