How India’s Mobile Tariff Rise Could Be – Times of India

Per capita gross national income (GNIpc) is the dollar value of a nation's final income per year divided by its population. So whichever is lower Telecom Rate as a percentage GNIpc, the more accessible the service will be in this country. Now, analysts and industry executives have pointed out that India's telecom tariffs are among the lowest in the world and telecom providers in the country have “plenty of room to raise prices”.
According to macro data collected by the International Telecom Union (that) (opens Economic Times) and the World Bank, when compared among countries with a GNIpc of less than $10,000, India's telecom tariffs are the second lowest at 1.11% of GNIpc after Brazil's 0.92%. The data shows that compared to India, telecom tariffs are much higher in South Africa (3.49% of GNIpc), Thailand (2.92%), Philippines (2.32%), Indonesia (1.71%), Egypt (1.6%) and Bangladesh. (1.4%).
In terms of plan pricing, India's telecom service tariff is the lowest in the world at $2 per month. On the other hand, Brazil's telecommunications tariff is significantly higher at US$6.1 per month, according to ITU data. The monthly telecom tariffs of other major economies such as China ($6.2), Philippines ($6.6), Malaysia ($9.2), USA ($43.6), Thailand ($15.8), Mexico ($10) and South Africa ($19) are much higher than India. The data also showed that Bangladesh's monthly telecom service charges are $2.9 higher than India's.
In a research note analyzing data from the ITU and the World Bank, ICICI Securities said: “Indian telecom tariffs are the most affordable in the world according to ITU database, which gives us comfort that the country's telecom service providers can increase tariffs by at least 1.5 times in the next 4-5 years, even as minimum data requirements increase. It still maintains its most affordable status.”
Why telecom tariffs may increase in India in 2024
Big telecom operators like it Reliance JioBharti Aertel and Vodafone Idea (Vi) will grow in 2024. According to analysts, both Jio and Airtel are set to complete their pan-India rollout 5G services soon. Meanwhile, Vi's 5G launch is still pending as the telco is yet to close its fundraising.
Analysts at ICICI Securities also said telecom tariffs in India have historically been inelastic. Despite the increase in overall subscriber adoption and data usage, the rates of popular mobile plans have increased only 2 times since July 2017.