State-owned Bharat Sanchar Nigam Ltd on Tuesday announced a 25 per cent cut in STD tariffs for fixed to fixed calls beyond 100 km within a circle, in a bid to bring rates at par with mobile tariffs.

The STD calls beyond 100 km would now cost Rs 1.80 a minute with a 40 second pulse against existing Rs 2.40 per minute, and the new rates would be effective from December 15, 2003.

"The idea of the new structure is that it is more in sync with cellular tariffs within a circle. Also it will help increasing the volumes of traffic as most of the fixed to fixed traffic is within a circle," BSNL Chairman and Managing Director Prithipal Singh said.

Singh said that the move would also encourage people to retain fixed phones.

"Although there is a large scale increase in mobile phones, fixed line phone will always be important," Singh said.

"For customers in the Super Plan, the effective rate will be Rs 1.20 per minute," he said, adding that these rates were valid from 100 km onwards.

For distances up to 100 km, BSNL currently charges Rs 1.20, and the new rates effectively mean that customers would be charged Rs 1.80 per minute for calls beyond 100 km, but within the circle boundary.

Asked about 17.9 lakh (1.79 million) BSNL subscribers surrendered landline telephones between April to October this year, he said that this was because of increasing options available to consumers.

"Our priority now is to increase subscriber base, and has nothing to do with quality of service," he said.

Subscribers opting for BSNL's alternate packages will get further discounted rates for intra-circle calls beyond 100 km.

For instance, the effective charges per minute for subscribers of BSNL's super package will be Rs 1.20 per minute instead of Rs 1.80 per minute.

Similarly, a customer opting for BSNL's economy plan would now pay Rs 1.50 per minute and for Special Plan he would pay Rs 1.37 per minute.

On whether the company was considering tariff reduction for intercircle calls also (calls from one circle to another), Singh said, "The traffic in this segment is not so much as within a circle."

"But we will consider it, and when the new Interconnect Usage Charges regime is implemented we will make announcements," he said.

BSNL claimed it had conduced a survey which found that customers who surrendered its landline phones 'came back' to BSNL in form of mobile phone subscribers.

In order to encourage customers to come back to BSNL, the corporation decided not to charge intermediate rental for reconnection.

Earlier this month, BSNL slashed by 50 per cent its international long distance rates to a few Asian countries -- Singapore, Hong Kong, Indonesia, Malaysia and Thailand -- as a festive season offer till January 15.

Call rates to these countries are now charged Rs 12 per minute as against Rs 24.

The discount call rates announced earlier -- to the United Kingdom at Rs 7.20 per minute and to other European countries, the United States and Canada at Rs 9.60 – were extended till January 15.

Both the groups of offers are valid round the clock with no distinction as peak and off-peak hours.