Telecom Regulator Caps Internet Port Charges and Pushes to Retire Old Technology

The Telecom Regulatory Authority of India has capped the fees that telecom companies can charge each other for internet-based connections between their networks. This marks the first time the regulator has set such a limit, aiming to help phase out decades-old technology used for connecting calls. Under the Telecommunication Interconnection (Port Charges) (Third Amendment) Regulations, 2026, an operator can charge a maximum of ₹5.6 lakh per year for a 1 Gbps internet-based port. For a 10 Gbps port, the fee can be no more than ₹42.3 lakh per year. A port is the meeting point where two networks exchange traffic, such as when a user on one network calls someone on another. These new rules will come into force on January 1, 2027.

Background

The previous rules for these charges were set in 2001 and last updated in 2012, back when networks relied on older E1 circuit technology. While companies now use modern internet networks for calls within their own systems, many still connect to rival networks using older E1 ports. The regulator noted that this mixed setup creates delays, lowers call quality, and increases costs.

New Rules

A separate amendment requires all new network connections to use internet-based technology and orders existing E1 links to upgrade within three years. Industry stakeholders informed the regulator that the older equipment is outdated, hard to buy, and difficult to maintain. The updated regulations also introduce daily penalties for operators that miss reporting deadlines, reaching up to ₹25,000 per day for the first 15 days and up to ₹50,000 per day thereafter, with a total cap of ₹15 lakh per service area for each violation.

Context

Regulators often set price caps and timelines to push industries away from obsolete systems toward modern infrastructure. Upgrading network interconnections helps reduce call drops and improves overall digital communication speeds for everyday users.