Mukesh Ambani’s Reliance Jio has made a significant announcement today. The telecom giant has decided to increase its tariffs by up to 25%, marking the first hike in over two years. This move is aimed at improving the company’s revenue from subscribers in a market known for its low prices.

India is renowned for having one of the cheapest mobile and data services globally, which has benefited consumers but posed challenges for investors. Telecom companies like Jio, Airtel, and Vodafone Idea constantly need to invest in evolving technologies and spectrum to stay competitive.

Analysts had predicted a tariff hike post the Lok Sabha elections, and now Jio has taken the lead. The impact of this decision will be reflected in the upcoming quarterly results for telecom companies.

Airtel’s CEO, Gopal Vittal, had recently highlighted the need for higher tariffs in India due to absurdly low average revenue per user (Arpu). Airtel aims to raise its Arpu to around Rs 300 to ensure the sustainability of its business.

Reliance Jio’s Chairman, Akash M Ambani, stated that the introduction of new plans will drive innovation and growth in the industry, focusing on investments in 5G and AI technologies. Jio currently boasts over 47 crore mobile subscribers, commanding a 41% market share.

Despite being a price-sensitive market, telecom companies like Jio and Vi are stepping up to increase their Arpu to improve their financial health and stay competitive in the ever-evolving industry.