Indian Economy News

TRAI releases “The Telecommunication Interconnection (Third Amendment) Regulations, 2026”

The Telecom Regulatory Authority of India (TRAI) released the Telecommunication Interconnection (Third Amendment) Regulations, 2026, on November 3, 2026. The regulations will take effect from January 1, 2027. Interconnection refers to the technical, operational and commercial arrangements that connect telecom networks, allowing traffic to flow between them and enabling users of different service providers to communicate seamlessly. The regulations were finalised after a consultation process that included a Pre-Consultation Paper in April 2025, a Consultation Paper in November 2025 and an Open House Discussion in January 2026. The amendment enables service providers to mutually agree on locations for handing over traffic. It also facilitates a transition from Long Distance Charging Area (LDCA) and Short Distance Charging Area (SDCA) level interconnection to the Licensed Service Area (LSA) level, resulting in lower latency and enhanced service reliability.

Existing traffic at LDCA and SDCA-level points of interconnection (POIs) will be migrated to LSA-level POIs within three years in a phased manner. All new interconnections will be Internet Protocol (IP)-based. Existing E1/TDM-based POIs will migrate to IP-based interconnection within three years, improving bandwidth efficiency and call quality. A specific framework has been introduced for the voluntary surrender of POIs. The validity and reassessment interval of bank guarantees have been extended from six to 12 months. Interest on delayed payment of interconnection charges will be capped at the State Bank of India’s one-year Marginal Cost of Funds-based Lending Rate (MCLR) plus 2%. A graded financial disincentive framework has also been prescribed for contraventions.

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