Thursday, July 14 2005 20:26 Hrs (IST) - World Time -

New Delhi: US has accused Tata group company VSNL (Videsh Sanchar Nigam Ltd) of impeding competition for American companies in the bandwidth market by resorting to unacceptable pricing mechanism.

In a communication to India's telecom regulator TRAI, the US Trade Representative office said that VSNL was creating obstacles to competitive pricing of bandwidth -- a charge the Indian telecom giant has refuted.

Identifying access to submarine cable landing stations controlled by VSNL as a "serious problem", an USTR official welcomed TRAI's initiative to develop policies to ensure that problems related to access to submarine cable systems do not impede the competitive supply of global communication capacity both into and out of India.

USTR's comments coincides with Reliance Infocomm's demand for creating regulatory intervention in the bandwidth market accusing VSNL of killing competition and charging discriminatory prices.

When contacted, a VSNL official said its prices are driven by commercial considerations and are not discriminatory. Cable landing station is not an isolated facility rather an integral part of a submarine cable system and their operations are governed by multilateral agreements, which prohibits anti-competitive and discriminatory practices.

USTR official said the GATS telecom annexe requires members, including India, to ensure that service suppliers of any other members are accorded access to and use of the public telecom transport network on reasonable and non-discriminatory terms and conditions for the supply of a service included in its scheduled commitments.