Telcos may raise call, data tariffs in early 2025, says analyst

Telecommunication companies in India are expected to implement a hike in call and data tariffs in early 2025, industry experts predict.

This move comes in response to mounting operational costs, intense market competition, and the need to sustain profitability in a rapidly evolving digital ecosystem.

According to analysts, the tariff revision could be driven by the rising cost of spectrum acquisition, network expansion to meet the demands of 5G deployment, and inflationary pressures.

“Telcos are under immense pressure to balance the costs of new technology rollouts with maintaining service quality. A tariff hike seems inevitable,” said Rohan Malhotra, a telecom consultant with Global Insights.

With the ongoing rollout of 5G services, telecom operators have invested heavily in upgrading their infrastructure. Bharti Airtel, Reliance Jio, and Vodafone Idea have collectively spent billions on acquiring 5G spectrum and deploying the necessary equipment to ensure seamless connectivity.

Rising energy costs and increased demand for data consumption are adding to operational expenses. “Data usage in India has surged exponentially, with the average user consuming nearly 20GB per month. Meeting this demand requires continuous upgrades in network capacity,” noted Priya Singh, an industry researcher.

Average Revenue Per User (ARPU), a key metric for telecom profitability, remains relatively low in India compared to global standards. Experts argue that current pricing structures are unsustainable in the long run.

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“Indian telecom tariffs are among the cheapest in the world. To remain competitive and profitable, operators need to rationalize pricing,” explained Rajeev Kapoor, an economist specializing in telecom markets.

While the potential tariff hike may strain consumers’ wallets, especially in a price-sensitive market like India, it could also encourage better service quality and faster technology adoption.

Some experts believe that higher tariffs may incentivize telcos to enhance network reliability and customer service. However, consumer advocacy groups caution that such increases could widen the digital divide, particularly for lower-income households.

The timing and magnitude of the hike remain uncertain, but most experts anticipate a gradual increase to mitigate backlash. “Telecom operators may opt for incremental changes to minimize the impact on users while securing their financial goals,” Malhotra added.

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Regulatory bodies, such as the Telecom Regulatory Authority of India (TRAI), are expected to closely monitor the situation to ensure fair practices and prevent monopolistic pricing.

As the telecom industry braces for this change, stakeholders—from service providers to consumers—will need to adapt. While the hike is aimed at sustaining the industry’s growth and innovation, balancing affordability and quality will remain a critical challenge in the months ahead.