Subscribers will now pay Rs 250 as opposed to the previous Rs 500. In South African terms that is a drop from R73 per month to R36.50 a month for a 256 Kbps broadband connection.

A.K. Sinha, MD of BSNL, said: “Following this move, we expect to add about 1 million broadband connections this year and about 2 million more next. About 1.8 million dial-up Internet connection users would be attracted to come over to a broadband network, for enhanced browsing experience.”

Users that opt for the once-off annual payment of Rs 2,500 (R365) will receive an even lower price that works out to approximately R30.45 per month.

The bad news is the BSNL slashed the download limit on the Rs 250 plan to 400 MB as opposed to the 1 GB for the previous package. The result is that heavy users may end up paying more at the end of the month making this scheme more expensive rather than cheaper for them.

But BSNL has dropped the rate from Rs 2 (R0.29) per MB to Rs 1.40 (R0.20) for users who have reached their 400 MB limit and would like to top up.

Rival provider MTNL are planning to fight for market share by offering a certain minimal amount per MB of download as opposed to monthly charges.

Currently Telkom’s HomeDSL 384 service with 2 GB of traffic will cost consumers R 558-00. This is around 15 times (1500%) more expensive than the 256 ADSL offering in India.