Their entire thrust is to move away from a regime of arbitrary pricing and arcane subsidisation, driven by a muddle-headed social welfare policy, to a cost-based and transparent tariff regime which at last segregates business from welfare.

This regime should take India forward in the direction of integrating with international business practice. Volume henceforth becomes the name of the game rather than high tariffs: in a peculiarly Indian subversion, the practice has hitherto been to penalise intensive use.

The good sense of the proposals should be apparent to any lay person. Long distance calls within and outside this country have been soabsurdly priced for so long and have had no relation to their pricing elsewhere. The reason was that in a confused application of the welfare principle, these calls subsidised local traffic, which is an area where tariffs have been brutally held down to levels way below cost.

The paper now proposes a cut of 40-60 per cent in the tariffs on STD and ISD calls, while sharply upping telephone rentals and local tariffs to bring them more into line with costs. Indeed it might have been wished that the reductions in long-distance rates were made right away but the TRAI has been bold enough in envisaging two-thirds of the cuts in the first year itself.

It could be argued that in the highly price-sensitive Indian market higher rentals and local call charges could discourage the number of subscriptions from growing as quickly as desired, but rational pricing has to be pursued even at some cost if the business is to attract investors. In any case it seems safe to bet that the growth will be fast enough.

Thecaller-pays principle for calls made from landlines to cell phones is a similarly sensible one. It has been a peculiarity of the Indian market that a cell phone owner pays for incoming calls, prompted by the assumption that he is far more able to afford it than a landline owner. The result has been for cell phone owners to take incoming calls selectively.

It would be foolish to expect traffic in this segment to explode suddenly: the proposed tariff of Rs 3.90 for a minute of such a call will deter enough landline callers. Even so, on balance it seems reasonable to expect that traffic will increase. In fact the TRAI's proposals create a rational and promising environment for investors to service the potentially humongous Indian market, even though some questions remain about the effects on consumers.

But the advantage of transparent pricing is precisely that the government can go ahead and target the weakest with subsidies rather than subsidise by default consumers who are quite capable of paying theirway. The TRAI has done its bit to set India on course for partaking in the telecom revolution. It is now imperative that the politicians do not get to dilute this promising effort in the changes that occur in this paper between now and the final tariffs due in November.