New Delhi, Nov 2026 : The Telecom Regulatory Authority of India (TRAI) on Tuesday released the Telecommunication Interconnection (Third Amendment) Regulations, 2026, introducing significant changes to the framework governing connectivity between telecom networks. The new regulations will come into effect from January 1, 2027.
According to an official statement, the amendments aim to modernise the existing interconnection framework in line with contemporary network architectures, improve operational efficiency and facilitate the transition towards IP-based connectivity and Licensed Service Area (LSA)-level interconnection.
Interconnection refers to the technical, operational and commercial arrangements through which two or more telecom networks are connected, allowing traffic to flow between them and enabling subscribers of different service providers to communicate seamlessly.
One of the key changes involves shifting the existing system of interconnection at the Long Distance Charging Area (LDCA) and Short Distance Charging Area (SDCA) levels to the Licensed Service Area level.
TRAI said the migration of traffic to LSA-level Points of Interconnection (POIs) would simplify routing and enable more efficient utilisation of scarce numbering resources. The transition is also expected to offer benefits such as reduced latency and improved service reliability.
Under the revised framework, existing traffic, measured in Minutes of Usage (MoUs), at LDCA- and SDCA-level POIs will be shifted to LSA-level POIs over a period of three years in a phased manner. Following the completion of the transition, all telecom traffic will be handed over or received through LSA or Service Area-level POIs.
The amendments also introduce provisions for IP-based interconnection between telecom service providers. All new interconnections established after the regulations come into force will have to be IP-based.
Existing POIs operating through E1/TDM-based interconnection will also be migrated to IP-based systems within three years through a phased process. According to TRAI, the transition is expected to improve bandwidth efficiency, call quality and overall end-to-end call performance.
For IP-based interconnection, the maximum call-handling capacity at a POI will be determined by considering its concurrent session-handling capability and available link bandwidth, while ensuring compliance with the prescribed Quality of Service requirements under relevant TRAI regulations.
Another important provision concerns the surrender of POIs. The regulator has introduced a separate framework for voluntary surrender, distinguishing it from the existing provision for disconnection.
While disconnection involves stopping traffic exchange at a POI in exceptional circumstances arising from differences between service providers, surrender allows a provider to voluntarily discontinue a POI for its own operational requirements. Such situations could include declining traffic volumes, withdrawal of services from a particular area or changes in traffic routing. TRAI said this provision would help service providers improve financial and operational efficiency.
The amendment also retains the existing bank guarantee framework but extends the validity of guarantees furnished following reassessment from six months to 12 months. The interval for reassessment has similarly been increased to 12 months. A revised methodology has also been introduced to determine the ceiling on bank guarantees for POIs, including those involving IP-based interconnection.
To address delays in payments, TRAI has introduced a specific provision covering outstanding interconnection charges and interconnection usage charges. The interest rate will be mutually decided by the service providers, subject to a maximum ceiling of the State Bank of India's one-year Marginal Cost of Funds-based Lending Rate (MCLR) plus two percentage points.
The revised regulations also prescribe reporting requirements to monitor the migration of traffic from LDCA/SDCA-level POIs to LSA-level POIs and the transition from E1/TDM-based to IP-based interconnection.
For effective implementation, TRAI has introduced a graded financial disincentive framework for violations of the amended provisions. The revised mechanism is intended to make enforcement more proportionate to the nature and seriousness of regulatory contraventions.
The regulator said the provisions relating to delayed payments, mandatory reporting and financial disincentives would strengthen compliance and ensure a more effective implementation of the revised interconnection framework.
