Govt Drops AGR Dues Waiver Plan, Deems Relief to Private Firms Unjust: Report

The government has put on hold the Department of Telecommunications’ (DoT) proposal to waive adjusted gross revenue (AGR) dues for telecom operators, citing a lack of consensus at the highest levels. This decision deals a setback to Vodafone Idea (Vi), which is struggling under a heavy debt burden, according to an ET Telecom report.

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Also Read: Setback for Vodafone Idea as Government Drops Consideration of AGR Relief: Report

Relief Proposal Breakdown

The proposal sought to waive 50 percent of interest along with penalties and interest on penalties, offering over Rs 1 lakh crore in relief to telcos. Vi, the biggest beneficiary, stood to gain more than half of this amount, while Bharti Airtel and Tata Teleservices would have received relief of Rs 38,000 crore and Rs 14,000 crore, respectively. Reliance Jio remained unaffected as it has no legacy AGR dues.

“The broader view in government circles is that it would be wrong to provide financial relief to private companies, some of which are profit-making, on an issue that has been settled and decided by the Supreme Court,” the report quoted a person aware of the details as saying.

Also Read: Government Confident of Vodafone Idea’s 4G and 5G Expansion Plans: Report

Major Setback for Vodafone Idea

The person reportedly added that the DoT will work on a revised relief plan for the debt-laden sector, given the precarious situation of Vodafone Idea.

“The option of taking additional equity in Vodafone Idea or any other relief measure is likely to be considered,” said the person, according to the report. “In principle, the government agrees that relief has to be given but the current AGR waiver proposal was not right.”