India’s July IIP growth at 7.1%

 

 

New Delhi: Industrial growth recovered to 7.1% in July from the dismal
performance in previous two months of the current fiscal, even though
it moderated compared with 8.3% recorded a year ago.
The improved data may give some breather to the Government and RBI,
struggling hard to check the double-digit inflation through tightening
monetary policy, which hampers the growth process.
While the manufacturing, which contributes about 80% to IIP, grew by
7.5% in July, compared with 8.8% a year ago, electricity generation
was up by 4.5%, against 7.5%.

Mining output growth, however, was quite higher at 5% from 3.2% a year
ago.

The growth in industrial production, as measured by the Index of
Industrial Production (IIP), was low at 3.8% in May and 5.4% in June.
In April, however, industrial growth stood at 7%, more or less same as
in July.

As such, industrial growth turned out to be 5.7% in the first four
months of this fiscal, against 9.7% a year ago.
The data came close to first quarterly economic growth figures at 7.9%
and would play a crucial role for the GDP figures for the next
quarter.

If, this trend continues and other sectors like agriculture and
services also contribute, GDP figure may be quite higher for the
second quarter

 

Trai asks telcos to bring down SMS charges

 

 

In a move that could halve SMS charges, the Telecom Regulatory Authority of India (Trai) has asked mobile operators to slash tariffs voluntarily. Unlike the voice traffic, the cost component in SMS is negligible–around 2 paise. Still, SMS tariffs are either higher than voice rates or at best comparable.

Sources say Trai has held two rounds of negotiations with the Cellular Operators Association of India (COAI), the apex of body of GSM mobile operators, convincing them to voluntarily bring down the tariffs, failing which it would intervene through regulation. In fact, two years back also Trai had urged the operators to bring down SMS rates.

The average tariff for local calls is Re 1, the same as the local SMS rate, while for STD calls, the average tariff is Rs 1.50 and the SMS rate is higher at Rs 2.

The operators, however, are resisting the move, as SMS makes up 50% revenue of their value added services. T hey feel this move would imply micro-managing of their operations by the regulator and argue that the rates be best left to market forces. Further, operators say that facing low average revenue per user (Arpu), revenue from value-added services (VAS) is critical to their profitability.

According to Trai, while service providers have to pay termination charges and carriage costs for voice calls, no such cost is involved in SMS traffic, apart from negligible capital expenditure.

For voice call, for instance, service providers pay a termination charge of 30 paise per minute---in cases where a call originates from one operator's network and terminates in another's. In cases where service providers do not possess a long distance network they pay a carriage charge, with a ceiling of.60 paise per minute to the ILD/NLD operator whose network is used for carrying the calls.

No termination charge is payable in the case of SMS traffic. For carrying SMS traffic, operators use a signalling channel, which is distinct from the channel used for carrying voice traffic. It is to bring parity between voice calls and SMS that the regulator has asked operators to bring down the SMS charges sharply.

For a telecom company, around 14% revenue comes from VAS, with SMS constituting almost half of it. Over the next five years, VAS could contribute 30% revenues to a telecom company

 

http://www.financialexpress.com:80/news/Trai-asks-telcos-to-bring-down-SMS-charges/359055/