Ministry proposes 50% cut in international termination rates to tackle illegal calls

12 Feb 2014

Bangladesh’s Ministry of Posts, Telecommunications, Information & Technology has decided to cut international incoming voice call termination rates by 50% from USD0.03 to USD0.015 per minute, in a measure aimed at fighting the illegal calls market. The Daily Star reports that if the rate reduction receives final approval it will be implemented for an initial six-month ‘test period’. Telecom secretary Abubakar Siddique confirmed that the decision was sent for Finance Ministry consent last week, but the proposal could take up to a month to consider, as it has the potential to backfire and dent government earnings from international call termination fees, currently standing at around BDT11 billion (USD140 million) annually via the 51.75% the state takes from licensed operators’ incoming call connection revenue. Siddique added that under the proposed new rates framework, the government would receive a reduced revenue percentage of 40%, as a further incentive to the licensed international gateway (IGW), interconnection exchange (ICX) and retail voice service operators, which split the remainder of incoming call revenues between them. Illegal calls bypass the IGW-ICX route, and the state receives no revenue from such calls. The telecom ministry’s decision was backed by the Association of Mobile Telecom Operators of Bangladesh which on 30 January 2014 wrote a letter to the ministry recommending the halving of the official minimum threshold rate to 1.5 US cents – as according to the association illegal calls currently cost on average between 1.5 and two US cents. Legal and illegal international call volumes are roughly similar at present, according to market sources cited by the Star report. During January 2014 the country received an average of more than 40.5 million international incoming call minutes per day, according to figures from the Bangladesh Telecommunication Regulatory Commission (BTRC).

TeleGeography’s GlobalComms Database notes that in an earlier measure to fight the ‘grey’ unlicensed international voice-over-internet protocol (VoIP) call market, the government reduced the minimum incoming overseas call termination rate by one US cent to USD0.03 per minute with effect from May 2009, although illegal VoIP operators were still able to offer cheaper rates. GlobalComms adds that Bangladesh has subsequently licensed a long list of official VoIP-based international incoming call operators alongside the legal IGW and ICX operators – but with the regulated minimum call rate stuck at a higher level than in the unlicensed sector, it appeared that further regulatory measures were necessary.

Bangladesh, Ministry of Posts, Telecoms & Information Technology (MoPTI),


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