The adjusted gross revenue (AGR) dues have been the hot topic of the entire telecom industry in India for the last few years. The telcos had waged and lost a battle against the Department of Telecommunications (DoT) for redefining the AGR. The government, though listened carefully to the sector’s wishes and changed the definition of the AGR dues as part of the relief measures announced recently. The DoT will not include non-telecom revenues in the AGR, so the dues for the telcos would be lower. However, according to an FE report, the telcos want the government to further look at the AGR’s definition.
Don’t Include OTT Revenues in AGR Dues
The telecom operators have asked the government to not include revenues generated from the over-the-top (OTT) platforms as well as handset sales. Then there are more things such as mobile advertising services, and more.
The basic point of the telcos is that all the revenues that are generated without using the licensed spectrum should not be included in AGR for paying spectrum usage charges (SUC). There are more services and areas through which a telco earns revenues, such as leased circuits, wireline calling services, port charges, bandwidth services, infrastructure sharing charges, and more than the telcos don’t want to be included.
The AGR dues and its interest accrued over the long-term can derail a telco’s operations. This was the case with Vodafone Idea (Vi) as well. But because of the relief measures, the older dues aren’t affecting the telcos that much. However, the telcos don’t want to be in such a position again where they have to pay dues and interest on revenues that should not be included in AGR. The operators want the format of the AGR to change, which is currently designed according to the circle/license. This could be a part of the second set of relief measures that are announced for the telecom industry.