Telecom operators have been facing huge financial distress due to massive AGR dues. A few days back, the supreme court directed all the telcos to submit an affidavit regarding AGR payments to the government and also the security arrangements. Analysing the context, COAI director general Rajan Mathews stated that the definition of AGR must be revised in an imminent manner which would avoid any similar issues in the telecom industry. As reported by ET Telecom, Rajan Mathews addressed the IANS and stated that moulding the definition of AGR will not violate the terms of the supreme bench. Currently, Telecom operators need to pay license and spectrum charges in the form of revenue to the government. The entire revenue amount used to calculate this share is termed as AGR.
AGR Must Include Revenues Earned Through Telecom Services: Telcos
As per the DoT estimates, telecom operators have to pay a whopping Rs 1.47 lakh crore AGR dues to the government. There has been a constant debate over the definition of AGR dues. As per telecom operators, AGR dues must only include revenues earned only through telecom services. However, DoT’s definition differs completely from telcos view, and the regulatory body states that AGR definition must consist of all the revenues earned from non-telecom services such as the sale of assets and deposit interests.
Reliance Jio Cleared AGR Dues Worth Rs 195 crore
Reliance Jio which is currently the largest telecom operator in India has cleared Rs 195 crore towards AGR dues. However, Vodafone Idea and Bharti Airtel has been facing massive financial distress. As per DoT, Bharti Airtel has to pay Rs 43,980 crore AGR dues whereas Vodafone Idea has to pay Rs 58,254 crore AGR dues to the government.
DoT Has Proposed 20-Year Timeline for Staggered Payments
Among all the telecom operators, Vodafone Idea has been most affected by the massive AGR dues. Government is ensuring that the telecom industry remains a three-player market, and healthy competition is maintained in the sector. Government is also debating on the proposal of allowing 20-year timeline for staggered payment by the telecom operators to resist the exit of financially distressed companies, especially Vodafone Idea.