Govt may raise direct international call rates

JAKARTA (JP): The government is considering increasing the rates for international telephone calls in order to keep the state-owned telecommunications company, PT Indosat, healthy, a government official has said.

Director General of Post and Telecommunications Sasmito Dirdjo said on Monday the cost for Indosat, which manages international telephone communications, to operate an outgoing call was much higher than its revenue from domestic users due to the sharp depreciation of the rupiah.

"If the operation costs exceed the income -- and I suspect it's going to be that way in October -- we may have to increase the rates," Sasmito told reporters.

He said Indosat and the ministry would discuss with members of the House of Representatives before it proposed the rate hike to the Minister of Communications Giri Suseno Hadihardjono for approval.

The president of publicly listed company Indosat, Tjahjono Soerjodibroto, said on Monday the collapse of the rupiah had left Indonesia's international telephone call rates much lower than other countries'.

For every minute, Indosat charged between 35 U.S. cents and 40 cents, but had to pay about 50 cents to 55 cents to foreign telecommunications companies, he said.

Tjahjono said the company could still survive because the outgoing calls traffic was considerably lighter than the incoming calls, so that the company could cover the losses.

"But if the tariffs remain at the current level, we could soon collapse if the traffic reverses," he said.

The government last increased the tariff for international telephone calls, by 25 percent, early this year to take into account the sharp depreciation of the rupiah against the U.S. dollar. But the rupiah has continued to fall since then and the 25 percent increase is no longer considered sufficient to cover the cost.

The rupiah has dropped by about 75 percent against the U.S. greenback since August last year, causing Indosat's international communications dollar-denominated costs to rise dramatically.

The company's providers, such as the U.S. AT&T and Japan's NTT charge in dollars while Indosat's revenues are in rupiah. (das)