COAI Asks For Extended Payment Timeline and Easy Interest Rates for Paying Back Dues

Published by
Arpit Sharma

The telecom operators in the Indian telecom space have raised their voices against the new burden that has found them in the wake of the Supreme Court decision which changes the definition of Adjusted Gross Revenue (AGR). The telecom operators are already under deep financial stress, and this new pressure from the government to pay up dues further increases their troubles. Now, one association in the telecom sector which promotes the interests of these companies is the Cellular Operators Association of India (COAI) which comprises of telecom companies like Vodafone Idea, Bharti Airtel and Reliance Jio. As per a new PTI report, COAI has remarked that the government should provide a three-year moratorium along with an extended payment deadline with easier interest rates. This would ease a pressure up a little bit on the telecom companies, as per COAI. The Director-General of COAI, Rajan Matthews, has added that the telecom operators need “oxygen” and there should be debt restructuring of all the dues that the telecom operators are required to pay to the government.


COAI Asks Extended Payment Deadlines

The COAI Director-General also added that most of the 4G licenses have a validity of 11 years left and hence, the government can have ten year payment timelines which would be spread over the entire license period thus allowing the telecom operators to easily pay off their dues which they are currently finding hard to pay. He further added, “It is also time to redefine AGR (adjusted gross revenue) prospectively.” Matthews also said that the telecom sector has been financially bleeding and in the quarter ending September, the telecom companies have posted losses which run upwards of Rs 1 lakh crore. To recall, in the quarterly earnings reports released last week for Bharti Airtel and Vodafone Idea, the two of the telecom companies have reported losses of Rs 74,000 crore combined for the same quarter on account of the statutory dues which have come up as the result of the new AGR order by the Supreme Court.

Highest Losses in Indian Corporate History

In the latest order by the Apex Court, the bench had decided that the definition of AGR would include non-core services being provided by telecom operators, this means that the companies would have to pay higher license fees and Spectrum Usage Charges (SUC) as it is decided on a percentage of AGR and is paid to the government. In its latest quarterly report, Vodafone Idea has posted a loss of Rs 50,921 crore, which is the highest loss ever posted in the Indian corporate history. Whereas, on the other hand, Airtel has posted a loss of Rs 23,045 crore. On a consolidated basis, Reliance Communications has posted a loss of Rs 30,142 crore which is the second-highest loss ever in India, following Vodafone Idea.

Vodafone Idea in Most Trouble

Now summing up the total dues that have come up on the telecom operators including Vodafone Idea, Bharti Airtel and more, these companies have to pay upwards of Rs 1.4 lakh crore to the government to account for the license fees and the SUC. Bharti Airtel has to pay Rs 62,187 crore (including share of Tata Group of companies and Telenor India), while Vodafone Idea may have to pay about Rs 54,184 crore. Vodafone Idea has also said that its ability to remain as going concern is pertinent to the relief that the government provides. The company is also going to file a review petition against the Supreme Court order.

Arpit Sharma

Arpit spends his day closely following the telecom and tech industry. A music connoisseur and a night owl, he also takes a deep interest in the Indian technology start-up scene and spends rest of his time spilling poetry and stories on paper.

Published by
Arpit Sharma

Recent Posts

Jio Offers Two Data Add-On Pack for 1 Year and They Cost a Lot

Reliance Jio, India's number one telecom operator, has two data add-on packs which can work…

Tech Mahindra to Help Accelerate Digital Transformation in Thailand

Tech Mahindra, a leading provider of digital, consulting and business solutions, has signed a Memorandum…

Vi Business Brings Vi Secure to Help Enterprises Enhance Security

Vodafone Idea's (Vi) B2B arm called Vi Business has just introduced a new security offering…

Baicells Deepen Partnership with Qualcomm to Promote Private 5G Globally

Qualcomm and Baicells have deepened their partnership by collaborating to promote 5G private networks globally,…

Telcos Failure to Respond to Rise in Cost of Living is Biggest Threat to Industry: EY

The telecom industry has been the backbone of the digital economy around the globe and…

Know the Differences Between 4G and 5G

While we still use 4G Networks, and they are going to stay and work along…

OnePlus Makes a Big Statement, to Offer 4 Years of Android OS Updates

OnePlus, a consumer electronics brand, has recently announced that it would be offering four years…

Vodafone Idea Looking to Raise Up to Rs 16,000 Crore from SBI

Vodafone Idea (Vi), the third-largest telecom operator in India, is reportedly looking to raise up…

BSNL has Two Super 300 Mbps Broadband Plans, Did You Know

Bharat Sanchar Nigam Limited (BSNL) has various 300 Mbps broadband plans on offer for customers.…