New Delhi, April 21: The telecom regulator today slashed the leased-line tariff by 70 per cent. However, major operators like Bharat Sanchar Nigam, Videsh Sanchar Nigam, Reliance Infocomm and AirTel are silent about when they will pass on the benefit to end-customers.

Domestic leased circuit (DLC) carries data and voice services within the country. DLC determines the bandwidth available to the operators , which is essential to provide higher quality voice and faster download of data for the end consumers.

It is very important for the promotion of broadband-based services like streaming video and high-speed surfing.

The service is provided by basic service operators/unified access service licensees (BSNL, AirTel, Reliance Infocomm), national long distance operators (VSNL, BSNL, AirTel, Reliance Infocomm) and infrastructure service providers-category II (Powergrid Corporation of India Ltd and Gail).

The Telecom Regulatory Authority of India (Trai) has revised downwards the ceiling tariff for different capacities by 3 to 70 per cent and for higher capacities it is 70 per cent less than the existing market rate. (See chart)

The key users of the service in India are internet service providers, information technology (IT) and IT-enabled service enterprises like business process outsourcing units, telecommunication service providers and corporate enterprises.

The tariff ceiling will come into effect from May 1, 2005, and will be reviewed after 12 months.

Trai directed that pro-rata corrections, wherever applicable, must be made to any advance payments that might have been made for leased circuits on the basis of prevailing tariffs by the customers.

The regulator added that the tariffs fixed are in the nature of ceilings and operators are at liberty to offer lower rates.

The ceiling tariff for domestic bandwidth (domestic leased circuit) was originally fixed in 1999.

A senior Trai official said: ?The competition was not fully effective in the provision of DLCs despite the increase in the number of players in the market. Rapid technological advances have sharply reduced the unit cost of bandwidth. However, the reduction witnessed in the leased line tariffs is not commensurate with that witnessed in the cost of providing the services. This prompted us to revise the tariff and a further cut is expected soon based on a consultation process with the stakeholders.?

The official said: ?A competitively priced DLC service is fundamental to achieving a higher rate of penetration of broadband in the country, which provides a basis for fundamentally transferring the socio-economic opportunities, particularly in rural India.?