An upcoming shake-up at China's telecoms regulator has fuelled speculation of a rise in domestic inter-connection fees during the second quarter. Sources at China Telecom were quoted over the weekend as saying an increase could be imminent as the company expects approval from the Ministry of Information Industry (MII) during the second quarter of this year. Analysts are split on whether the telecommunications operator could obtain such a swift green light. China Telecom was not available for comment. Wang Lijian, head of the information office of the MII, also refused to comment on the speculation. DBS Vickers Securities' Wallace Cheung said increasing the fee in the second quarter would be in line with his expectations. He said the charge would be raised from six fen to seven fen but more adjustments would come later. In November, China Telecom chairman Zhou Deqiang talked about raising domestic inter-connection fees when the company made a debut in Hong Kong's H shares. 'I think this exercise is not a one-off measure. It will be a recurrent revision of the domestic inter-connection fee,' Mr Cheung said. However, Joe Locke, ABN Amro regional telecoms research head, said it was likely China Telecom would receive approval by the end of this year. Fears of an increase have intensified as the regulatory landscape changes with the departure of MII chief Wu Jichuan. He is to be replaced by Hebei province party secretary Wang Xudong in March. The possible increase in inter-connection charges would have a negative impact on mobile telephone operators. Analysts said mainland telecommunication operators had little room to transfer the cost to consumers. A spokesman for China Mobile said yesterday the company 'has not received any notification on this respect'.