ICH’s removal to curtail local operators’ businesses

KARACHI: Industry experts termed annulment of International Clearing House (ICH) by government anti local-business verdict. The beneficiary will only be the international players and local operators and government will suffer revenue losses. 
Ministry of Information Technology (MoIT) issuing a directive to the Pakistan Telecommunication Authority (PTA) asked to discontinue the ICH regime, established through an earlier directive to substantially deregulate the international incoming traffic terminating on Pakistani network. 
This directive of the MoIT will be effective from August 1, 2014 giving sufficient time to Long Distance International (LDI) operators for discharging their commitments under the prevalent ICH arrangement.
Telecom expert Sohaib Sheikh said, “Withdrawal of ICH will leave negative impact on national economy and national exchequer”. Government could do better for elimination of grey traffic by taking necessary measures instead of simply withdrawing the ICH that had potential to bring multi million dollars into country every year, he added.
However, there is time to see how the new setup will achieve effectively to eliminating grey traffic. The main beneficiaries of the new regime would be the international consumers calling Pakistan but it will be a challenging scenario for operators as the top-line would increase, however, with lower margins, the bottom line will be affected negatively, Sheikh added.
It is obvious apart from cellular mobile operators, other LDI operators of ICH club will suffer huge revenue losses as their core revenue generation depends on international traffic including semi state owned telecom company.
Another industry expert said the club was not allowed to achieve its real purpose as the initiative was being hindered by numerous efforts from its opponents throughout the time by creating hurdles to involve the guild in court matters. Exit of cellular operators and desultory efforts of regulator to stop grey traffic also resulted in ineffectiveness of the ICH. 
If regulator considerably focuses on the ICH then the club could have been given positive results but unfortunately the bold step of the government maligned by industry players to cater their own agendas due to which MoIT compelled withdrawing the decision.   
While the callers are used making calls with elevated calling rates then it is expected the cellular and other LDIs will never reduce their calling rates to rational level as the consumers are not aware with the technical terms like ICH and grey traffic, he added. The decision is expected to remain unfruitful for consumers, as by tradition in Pakistan, the prices never come down if once they hike, said the expert.  
He was of the view that in fact LDI minutes were on declining trajectory but the revenue of government was still healthy during ICH regime.
On the other hand, Internet Service Providers Association of Pakistan’s Convener Wahaj us Siraj welcomed the MoIT’s decision saying the decision should have been taken much time ago as the industry was continuously suffering with declining international calling minutes which came down to 390 million minutes by the end of April 2014 from 1.2 billion before ICH. e said by thgi sdecisin overseas PAkistani can enjoy cheap call rates which will be leading to 
After this decision overseas Pakistanis can enjoy cheap international call rates, which will also helpful to reduce grey traffic near zero, he added. 
“The leading telecom company made the cartel only to accommodate its business which collapsed badly due to its unfair objective”, he added.
According to Chairman PTA, after withdrawal of 9.2 cent per minute levy on the international calls, the rates will be reduced upto 2 to 3 cent per minute due to fair and free competition among operators. He was optimistic the grey traffic would end gradually after this decision. Fax from Saudi Arabia will also be possible now, he added.

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