DoT asks India’s Supreme Court to grant 20 year AGR payment terms, or risk industry collapse

Collectively, India’s beleaguered telecoms operators and internet service providers owe a combined $193 billion in AGR dues, charges and late payment penalties
India, AGR, Finance, Telecoms, Vodafone Idea, Bharti Airtel

Share

The Indian government has filed a petition to the country’s Supreme Court to allow Indian telcos to repay their outstanding dues over a 20 year period.

In October 2019, the Supreme Court ruled that telcos must adjust the way in which they calculate their adjusted growth revenues (AGR), in a ruling that saddled the industry with a total of $193 billion (1.43 lakh crore rupees) of debt, spread across at least 15 major telcos and internet service providers.

Both Vodafone Idea and Bharti Airtel have made payment of the principal amount of their outstanding dues. However, both are also liable for a host of late payment charges, interest payments and penalties, which could push their total debts into multiple billions of dollars.

Vodafone Idea is particularly affected by the AGR ruling and has repeatedly called for government assistance in making payment of its debts, before it is forced to declare insolvency.

Earlier this week, Vodafone Idea paid $923 million (6,854 crore rupees), clearing the principal amount owed for the 2018/19 year. However, the DoT estimates that Vodafone Idea owes a total of $7.1 billion (53,000 crore rupees), when charges and fees are factored in. It will be this amount that could be hypothetically spread over a twenty year term, if the Supreme Court grants the DoT’s request.

Under the terms of the DoT’s proposal, telcos would be given the option of repaying their total dues over a 20 year period at a fixed interest rate of around 8 per cent.

The Supreme Court is expected to rule on the proposal in the coming weeks.


Editor's Choice

Emerson expands analytics platform for industrial enterprise-level wireless infrastructure management
Plantweb Insight platform adds two new Pervasive Sensing applications that manage wireless networks more efficiently with a singular interface to the enterprise
Digitalisation seen as a competitive advantage by Middle East private businesses
Nearly 80 per cent of private business leaders acknowledge that digitalisation can impact business sustainability
Etisalat introduces Multi-Access Edge Computing architecture delivering best-in-class video streaming performance for 5G networks
MEC architecture achieves performance gains of as much as 90% in video streaming, validating how ultra-low-latency applications will be delivered over 4G and 5G networks

Most popular

Don't Miss a Story