According to Nepal Telecommunications Authority (NTA), call rates have decreased by almost 50 percent compared to the rates four months ago. Earlier a call to Nepal from India used to cost around IRs 12 per minute, but now it costs just around IRs 5.4-6.5.

NTA Chairman Digambar Jha said in line with Modi’s commitment, Indian telecom companies are imposing lower termination charges for calls routed to Nepal. “We also pressured Nepali service providers to cooperate with Indian companies to reduce the tariff. They accepted and started negotiating with stakeholders concerned,” Jha said.

He said there was a misunderstanding that the call rates were higher because of higher termination charges in Nepal, which was not the case. “The termination charge in Nepal was around Rs 6, but the call rates were at around Rs 19 (IRs 12), meaning Indian companies were having a benefit of Rs 13,” he said.

Jha added the reduction in call rates is applicable in the Delhi area and is gradually being implemented in other circles.

Ncell’s Corporate Communications Expert Milan Sharma said the company has reduced the charges. “We have conveyed the call carriers with a message that we are open for discussing rates if the benefits will be passed on to the end consumers,” Sharma said.

When Nepali operators decrease the termination charge it hurts Indian operators as the cost is higher in Indian and inter-connection charge is fixed based on mutual agreement. Sources say the operating profit (apart from costs) of calls from India to Nepal for Nepali operators stands at 35 percent, while the same for Indian companies stands at around 300 percent.

Sharma said since more than 3 million Nepalese are reportedly living in India, Nepali operators are willing to make the call rates cheaper.

First, India’s state-owned BSNL announced a 35 percent reduction in call rates in October 2014.

According to a report in the online edition of Indian television channel NDTV, BSNL has launched a special tariff voucher (STV) which allows people to call to Nepal at IRs 6.50 per minute against the normal rate of IRs 10.

“While most of the Indian operators have already decreased the tariff, a few are still left. We are hopeful they too will follow the path very soon,” Jha said.

Nepali operators, however, say BSNL was not reducing the tariff wholeheartedly, but just for the sake of the Prime Minister’s words. “BSNL has actually introduced a package for six months starting from October,” a source said. “Since Indian companies are not having a good balance sheet in their domestic market due to cut-throat competition, they always want to earn from international calls.”

Despite the reduction in the charge for terminating calls by almost half, Indian companies are still having a profit for making calls to Nepal,” Buddhi Prasad Acharya, managing director at Nepal Telecom (NT) said. “This is because Indian operators were charging higher.”

He said Nepali operators have introduced a number of packages for making calls to India, and they have urged Indian operators to come up with such packages.