TRAI Issues Telecom Interconnection Third Amendment Rules 2026

The Telecom Regulatory Authority of India (TRAI) released the Telecommunication Interconnection (Third Amendment) Regulations, 2026 on 3 November 2026. The amended rules come into force on 1 January 2027 and rewrite parts of the Telecommunication Interconnection Regulations, 2018.

Interconnection is the set of technical, operational and commercial arrangements that join two or more telecom networks so that calls, messages and data can pass between them and a subscriber of one operator can reach a subscriber of another. Authority to lay down the terms of interconnection, and to see that different operators remain technically compatible, comes to TRAI from Section 11(1)(b) of the TRAI Act, 1997.

Main changes

• Interconnection at LSA level: providers and seekers may now settle by mutual agreement where traffic is handed over. The framework shifts from the old Long Distance Charging Area (LDCA) and Short Distance Charging Area (SDCA) levels to the Licensed Service Area (LSA) level, which simplifies routing, husbands scarce numbering resources and lowers latency.
• Migration of existing traffic: minutes of usage carried at LDCA and SDCA level points of interconnection (POIs) must move to LSA-level POIs in phases within three years, after which all handover happens at LSA or service-area level.
• IP-based interconnection: every interconnection set up after the rules begin must be IP-based, and POIs still running on E1 or TDM links must be converted to IP within three years.
• Surrender of POIs: a separate route has been created for an operator to give up a POI voluntarily, for instance when traffic thins or it withdraws from an area. Earlier the rules spoke only of disconnection, which is a step taken because of a dispute with the other operator.

Money and enforcement

The bank guarantee framework stays, but the validity of a guarantee furnished after reassessment, and the gap between two reassessments, both go up from six months to twelve months, and the method of fixing the guarantee ceiling has been revised to cover IP-based interconnection as well. Where interconnection charges or interconnection usage charges are paid late, the rate of interest is for the two operators to agree, subject to a ceiling of the State Bank of India one-year Marginal Cost of Funds-based Lending Rate (MCLR) plus two percent. Reporting duties have been prescribed so that the shift of traffic and the move to IP can be tracked, and a graded scale of financial disincentives now applies to breaches.

How the rules were framed

TRAI opened the review with a pre-consultation paper dated 03.04.2025, followed by a consultation paper on 10.11.2025. After an extension, written comments closed on 15.12.2025 and counter-comments on 29.12.2025. Seventeen stakeholders sent comments and nine sent counter-comments, and an Open House Discussion was held on 28.01.2026 before the amendment was finalised.