Government Considers Major AGR Relief for Telecom Sector: Report

The Indian government is reportedly considering another wave of relief measures for the struggling telecom sector, which could offer significant financial relief to companies such as Vodafone Idea (Vi), Bharti Airtel, and Tata Teleservices. After easing the financial burden by waiving the requirement for telecom operators to provide bank guarantees for past spectrum dues in December 2024, the government is now evaluating a proposal to waive a substantial portion of the dues linked to the Adjusted Gross Revenue (AGR) following a 2019 Supreme Court ruling, both ET and Moneycontrol reported, citing multiple sources.

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Also Read: Government Waives Bank Guarantees; Vodafone Idea Sees Boost for 4G, 5G Investments

Proposed Waivers on AGR Dues and Penalties

According to the reports, this new relief plan includes proposals to waive 50 percent of interest on AGR dues, along with 100 percent of penalties and interest on penalties. If finalised, this could result in over Rs 1 lakh crore in financial relief for the telecom sector, with Vodafone Idea benefiting the most due to its severe financial distress. Specifically, Vi’s AGR dues could be reduced by over Rs 52,000 crore, Bharti Airtel’s by Rs 38,000 crore, and Tata Teleservices’ by Rs 14,000 crore.

Reliance Jio has no legacy outstanding AGR dues and is unaffected by the proposed measure. Tata Tele has ceased offering retail mobility services and now solely provides enterprise mobility services.

Ongoing Discussions on AGR Relief

“There is positive momentum within the government, with discussions involving the finance ministry, the telecom department, and the cabinet secretariat. While no timeline has been set, there is agreement that relief should be extended to telcos on the AGR issue,” a senior telecom executive familiar with the talks was quoted as saying.