The committee has viewed that 63 per cent to 220 per cent increase in bimonthly rents suggested by the authority are "too high and abrupt" and will substantially depress the demand particularly in rural areas.

The committee recommended an in-depth study of the Department of Telecommunications (DoT) proposals of only marginal increases in rentals ranging from 25 per cent to 35 per cent as the tariff had not been revised since 1993.

Briefing newspersons about the unanimous report of the committee, tabled in Parliament on Tuesday, committee chairman Somnath Chatterjee said the committee was "perturbed" to note the outcome of the studies made by some experts which pointed out that bimonthly bills of people who restricted telephone use mostly to local calls were likely to increase by 52 to 72 per cent inmetropolitan cities and by 140 to 310 per cent in rural areas.

On the other hand, he said overall bills of the business and affluent sections of the society making a lot of long distance local and international calls would come down by 30 to 50 per cent.

Chatterjee said the committtee wanted that the Trai proposals be exmained in the light of these studies to arrive at correct conclusions and as a matter of last resort, the government should consider taking recourse to the provisions of Section 25 (2) of the Trai Act.

He said the Trai proposals came into direct conflict with the avowed objectives of the National Telecom Policy 1994 which promised telecom for all and within the reach of all as well as universal service covering all villages.

The committee, he said, had found that cost-based tariff structure was not the only suitable structure for the country to increase telephone density and asked the government and Trai to examine in depth, the implications of introduction of cost-based tariffstructure under the present circumstances when conditions of perfect competition did not exist in basic telecom service and that funds generated by the long-distance call tariff were required "desperately" for expansion of telecom in the rural areas.

According to the report, Trai proposals would cost the DoT Rs 52,318 crore in terms of internal resource generation during the period of perspective plan 1997-2002.

DoT would be required to borrow funds to the tune of Rs 98,224 crore from market as extra-budgetary resources (EBE) instead of Rs 10268 crore planned originally with an additional interest liability at the rate of 15 per cent, the committee said.

Describing it as "quite alarming", the report said it required attention at the highest level in the government and an in-depth examination keeping in view the overall interest of the consumers of telephone services of all categories as required by Section 11 (1) of the Trai Act.