Bharti Airtel has reportedly approached the Department of Telecommunications (DoT) to convert a portion of its statutory dues into equity, invoking provisions of the 2021 telecom reforms package. The move is aimed at ensuring a level playing field in the sector, following the government's decision to convert Vodafone Idea's dues into equity, which raised its stake in the struggling telco to over 49 percent.
Also Read: Government Stake in Vodafone Idea Rises to 48.99 Percent After Fresh Equity Allotment
Airtel's Equity Conversion Request
Airtel has formally submitted its request to the DoT, although the company has not released an official statement, ETTelecom reported, citing officials familiar with the matter.
"All companies can apply as per the reforms package. The government will take a decision after properly evaluating the demand, and any new equity conversion will be decided on a case-by-case basis," moneycontrol reported, citing a government source.
This development comes at a time when the government has put on hold a proposal to waive 50 percent of the interest and penalties related to adjusted gross revenue (AGR) dues—an initiative that was expected to provide relief to telecom operators who have exhausted all legal remedies.
If approved, Airtel's move could greatly ease its debt load and enhance its financial flexibility, especially as competition heats up and 5G investments continue.
Also Read: Indian Government to Raise Stake in Vodafone Idea to 48.99 Percent
AGR Dues and the Sector's Financial Strain
The telecom industry has been under financial stress since the entry of Reliance Jio in 2016 triggered intense price competition. Matters worsened after the Supreme Court's 2019 verdict backing the government’s definition of AGR, resulting in dues of Rs 1.47 lakh crore across the sector. Of this, Rs 92,642 crore related to licence fees and Rs 55,054 crore to spectrum usage charges (SUC), with nearly 75 percent comprising interest, penalties, and interest on penalties.
Also Read: Airtel to Acquire 400 MHz Spectrum in 26 GHz Band From Adani Data Networks
Relief Package and Moratorium Timeline
As part of the September 2021 relief package, the Centre had granted a four-year moratorium on the payment of AGR and spectrum dues. This moratorium expires in September 2025 for spectrum liabilities and by March–April 2026 for AGR dues, after which a staggered repayment schedule—running until 2031—will commence, with 10 percent due by March 31 each year.
Airtel had availed the moratorium but, until now, had not opted for equity conversion—a step that may now align its financial strategy more closely with that of Vodafone Idea.
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