New Delhi: The Telecom Regulatory Authority of India (TRAI) has introduced new rules for how telecom companies connect their networks and exchange calls and other traffic. The Telecommunication Interconnection (Third Amendment) Regulations, 2026, will come into effect from 1 January 2027.
In simple terms, interconnection allows customers of one telecom operator to call or communicate with customers of another operator. For example, it enables a Jio user to call someone using Airtel or BSNL.
The new rules aim to make this process smoother, improve network performance and bring India's telecom system in line with newer technologies.
What changes under the new rules?
1. Telecom companies can connect networks at the state-level service area
Telecom operators will be allowed to mutually decide where they exchange network traffic. The rules encourage a shift from smaller local-level connection points to larger Licensed Service Area (LSA)-level points.
This is expected to make call routing simpler, reduce delays and improve service reliability.
2. Existing traffic must shift within three years
Telecom companies will have three years to move existing traffic from the older local-level connection points to LSA-level points. The change will take place in phases.
3. New connections must use IP technology
All new interconnections between telecom companies will have to use IP-based technology from 1 January 2027.
Existing connections using older E1/TDM technology will also have to be shifted to IP-based systems within three years. This technology can use network capacity more efficiently and help improve call quality.
4. Clearer rules for network capacity
TRAI has set out how telecom companies should calculate the capacity of IP-based connection points. The calculation will consider how many calls or sessions a connection can handle at the same time and the available network bandwidth, while maintaining service quality.
5. Telecom companies can voluntarily close unused connection points
The new rules introduce a separate process for surrendering a point of interconnection (POI). A company may choose to surrender a connection point if traffic has reduced, services have been withdrawn from an area or traffic is being routed through another point.
This is different from disconnection, which generally involves stopping traffic exchange due to a dispute or other exceptional circumstances between operators.
6. Changes to bank guarantee rules
The existing bank guarantee system will continue. However, the validity period of guarantees submitted after reassessment, as well as the time between reassessments, has been increased from six months to twelve months.
TRAI has also revised the method used to calculate the maximum bank guarantee required for connection points.
7. Interest on delayed payments
If a telecom company delays payment of interconnection charges, interest may be charged. The rate will be mutually decided by the companies but cannot exceed the State Bank of India's one-year MCLR plus two percentage points.
8. Regular reporting to TRAI
Telecom companies will have to report their progress on shifting to LSA-level connection points and moving from older E1/TDM systems to IP-based technology. This will help TRAI monitor whether the changes are being implemented on time.
9. Financial penalties for violations
TRAI has introduced a graded system of financial disincentives for companies that fail to follow the regulations. The amount will be linked to the nature and seriousness of the violation.
Why do these changes matter?
The new rules are intended to make it easier for different telecom networks to work together. The shift to IP-based technology and larger connection points is expected to improve call quality, reduce delays and help operators use their network resources more efficiently.
The changes will also provide clearer rules for payments, capacity management and the closure of unused connection points.
The full text of the regulations and the explanatory memorandum is available on TRAI's website at www.trai.gov.in.
