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Indian ILDOs settle international voice traffic with hundreds of foreign carriers under bilateral USD-denominated commercial agreements with destination-by-destination rate sheets and mixed direct vs hub routing. The reconciliation must tie originating-side CDRs against the foreign carrier's monthly settlement statement, decompose hub-vs-direct, manage FX risk between agreement booking and remittance spot, withhold Section 413 payment code 1062 TDS with DTAA documentation, and discharge GST under reverse charge on ILD inbound under Section 5(3) IGST.
Aggregate originated international minutes by destination country and routing class (direct vs hub); apply the bilateral agreement rate per minute in USD; reconcile against the foreign carrier's monthly settlement statement; book the INR cost at the period-end RBI reference rate; settle at spot through the AD bank; book the realised FX variance under Ind AS 21; document the no-PE / DTAA / TRC position per remittance with Form 15CA/15CB and withhold Section 413 code 1062 TDS where chargeable; discharge reverse-charge GST under Section 5(3) IGST on ILD inbound and claim ITC.
Foreign-carrier master with bilateral agreement and route policy; USD rate sheet by destination and route; CDR aggregation by destination and route class; FX rate table (RBI reference + spot at remittance); AD-bank remittance ledger; Section 413 code 1062 chargeability matrix with DTAA / TRC / Form 15CA-CB inputs; reverse-charge GST classification for ILD inbound.
A reconciled ILD settlement dashboard showing originated-vs-settled minutes per foreign carrier per destination and route, applied USD rate validation against the bilateral agreement, INR cost at booking and at remittance with the realised FX variance, Section 413 code 1062 TDS position per remittance with DTAA documentation, and reverse-charge GST discharged and ITC claimed under Section 5(3) IGST.
An Indian ILDO carries 1.4 billion minutes of outbound international traffic a month to 230 destination countries through a mix of direct and hub routes, settling with around 120 foreign carriers under bilateral commercial agreements. The settlement runs in USD; the books run in INR; the reconciliation runs between the originating-side CDR aggregate, the foreign carrier’s settlement statement, and the AD-bank remittance file — with FX risk and Section 413 payment code 1062 TDS sitting on top. This is telecom ILD reconciliation India.
Quick reference
| ILD layer | What it covers | Anchor | Reconciliation anchor |
|---|---|---|---|
| Bilateral agreement | USD per minute by destination and route | Foreign carrier contract | Rate sheet per agreement |
| CDR aggregation | Originated international minutes | MSC / international gateway | Destination + route class |
| FX risk | INR-USD spot variance | RBI reference + AD bank | Ind AS 21 realised FX |
| Foreign carrier TDS | Non-resident withholding | Income Tax Act 2025 | Section 413 code 1062 + DTAA + Form 15CA/15CB |
| ILD inbound GST | Import of telecom service | IGST Act | Section 5(3) reverse charge at 18 percent |
Bilateral agreement structure
Unlike domestic IUC, ILD rates are not regulator-mandated. Each Indian ILDO negotiates bilateral commercial agreements with foreign carriers, with USD-denominated rates that vary by destination country and route quality. A single agreement can carry 80-plus destination lines, each with a per-minute rate that resets quarterly or on demand. The DoT licence framework governs the ILDO posture, but the rate sheet is private.
Hub routing vs direct routing
For each destination, the ILDO chooses between a direct route to the terminating operator (premium quality, higher rate) and a hub route through an intermediate transit carrier (lower rate, quality trade-offs). The routing decision per minute is made at the international gateway by least-cost-routing (LCR) logic, and the resulting traffic mix per destination must be reconciled against the relevant agreement rate. A reconciliation that nets at the destination level only — without breaking out direct vs hub — silently masks rate-application errors.
FX risk on monthly settlement
The Indian ILDO books the ILD cost in INR using the period-end RBI reference rate against the USD-denominated settlement statement. The actual remittance happens days or weeks later through an authorised dealer bank at the spot rate on the remittance date. The difference is a foreign exchange variance, booked through Ind AS 21 monetary-item revaluation. The reconciliation ties booked liability to remitted INR with the realised FX line — and the realised FX line itself must reconcile to the AD-bank remittance debit advice.
Section 413 code 1062 — non-resident withholding
Remittance to a non-resident foreign carrier falls under Section 413 of the Income Tax Act 2025, payment code 1062, which replaced legacy Section 195. Chargeability is the central question: payment for pure international voice termination by a foreign carrier with no Indian business connection or PE is frequently not chargeable, supported by the relevant DTAA, a tax residency certificate, and Form 15CA/15CB filed for each remittance. The reconciliation per remittance documents the no-PE position — or applies withholding where chargeable. See the Section 413 code 1062 article for the framework.
Quantify ILD settlement exception cost
Use the three-way match exception cost calculator to size the analyst hours and rupee impact of foreign-carrier settlement disputes.
Open the three-way match cost calculatorReverse-charge GST on ILD inbound
When the Indian ILDO is the recipient of an import of telecom service from a foreign carrier — typically, the foreign carrier terminates Indian-originated traffic abroad — the Indian ILDO discharges GST under reverse charge at 18 percent under Section 5(3) of the IGST Act and claims ITC. The reverse-charge entry reconciles to the GSTR-3B 3.1(d) outward line and the 4(A)(3) inward ITC line. Mis-classifying ILD inbound as outside the scope of GST is a common audit finding.
Worked example — one corridor, one month
Take settlement with one foreign carrier on the US corridor for one month:
- Outbound minutes to the US: 2.1 crore. Direct-route minutes: 1.4 crore at USD 0.012 per minute. Hub-route minutes: 0.7 crore at USD 0.008 per minute.
- Settlement USD: 1.4 crore times 0.012 plus 0.7 crore times 0.008 equals USD 168,000 plus USD 56,000 equals USD 224,000.
- INR booking at period-end RBI reference rate of Rs 83.20 per USD: Rs 1.86 crore.
- Remittance at spot rate Rs 83.65 per USD ten days later: Rs 1.87 crore. Realised FX loss: Rs 1.01 lakh through Ind AS 21.
- Section 413 code 1062: no-PE position documented under the US-India DTAA with TRC; Form 15CA Part D and Form 15CB filed; no withholding.
- Reverse-charge GST under Section 5(3) IGST: foreign carrier’s portion of Indian-originated traffic terminated abroad subject to GST at 18 percent; recon ties 3.1(d) outward and 4(A)(3) ITC.
Where ILD sits in the telecom reconciliation surface
ILD settlement is the international leg of telecom interconnect, complementary to domestic IUC reconciliation. Both feed the cost-of-revenue line. ILD adds USD-INR FX risk and Section 413 code 1062 chargeability analysis that domestic IUC does not carry. For the licence and settlement framework, see the Department of Telecommunications.
What automated reconciliation changes
ILD CDR volumes — 1.4 billion minutes a month across 230 destinations and 120 foreign carriers — make manual reconciliation infeasible. Purpose-built reconciliation software India ingests international-gateway CDRs, aggregates by destination and route class, applies the bilateral agreement rate table, reconciles against foreign carrier settlement statements, books FX variance under Ind AS 21, and produces Section 413 code 1062 and reverse-charge GST evidence. For the GST side, see GST reconciliation software.