Vodafone Idea Aims at Having a Fresh Start in India After AGR Crisis

Government is not planning to monopolise the Domestic Telecom Industry as Vodafone Idea has 30 crore subscribers in India

Highlights
  • Vodafone Idea is under several financial stress owing to AGR dues
  • The telco is constantly seeking relief from the government over AGR dues
  • Vodafone Idea has 300 million subscribers in India

Over the last few weeks, we have been hearing a lot about Vodafone Idea Limited and its massive financial stress. The telco has to pay over Rs 53,000 crore to the government towards AGR dues. As we reported last week, Vodafone Group CEO was about to meet government officials to discuss the AGR crisis. Nick Read, who is the CEO of Vodafone Global Plc met with the government officials and noted that the company wants a fresh and good start in India. As per the sources of ET Telecom, Nick Read met with the finance minister of India Nirmala Sitharaman along with Telecom Minister Ravi Shankar Prasad to discuss relief measure which would ensure the viability of Vodafone Idea in the Indian telecom industry.

Government Might Not Monopolise Indian Telecom Industry

Telecom Minister Ravi Shankar Prasad clearly noted that the government is not planning to monopolise the telecom industry as Vodafone Idea has almost 300 million subscribers in India. When Vodafone and Idea Cellular were merged, the subscriber base was around 440 million. Not only this, the Indian market is growing at a rapid scale and currently attracting various foreign investors.

Nick Read marked that AGR issues must have been resolved back earlier as the telco is now facing huge distress. The government also wants Vodafone Idea to remain invested in India. To ensure Vodafone Idea stays in the industry, the government is planning various relief measures which would solve their massive AGR dues.

Notably, the government might fix floor tariffs soon as it would revive the telecom sector and help the telecom sector to recover their losses. Telecom operators are now supporting floor pricing, including Reliance Jio as the financial health of the telecom industry is not in good shape.

Vodafone Idea AGR Dues a Big Setback for the Company

As per the estimates of DoT, Vodafone Idea has to pay Rs 53,000 crore to the government. However, the operator has self-assessed their AGR dues which stands Rs 23,000 crore out of which approximately Rs 7,000 crore is the principal amount. Currently, Vodafone Idea has just paid Rs 3,500 crore. Vodafone Idea has addressed the government to provide relief measures otherwise, they would be forced to shut down their operations.

Also, the telco giant has asked the government to allow GST refund of Rs 8,000 crore which will be later settled in their AGR dues. Government is also planning to create stress funds which would offer soft loans to stressed telcos on easy terms.

Chakri is a go-to guy for your next smartphone recommendation. Back in his engineering days, he used to play with smartphones by installing custom ROMs and that passion got him into the tech industry. He still goes nuts about a smartphone knocking his door for review. Currently managing everything at Telecom Talk, Chakri is trying to master PUBG Mobile in his free time.

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LALITThamilan daaBharat KhannaKarthikChetan-bengaluru Recent comment authors
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Chetan-bengaluru
Chetan-bengaluru

Lot of discussion below and speculation of revival of void depends on HOPE!!!!! We haven’t yet heard anything officially from neither Nick or vil directly. Infact the body language after coming out of meeting says something else in short video clip and guys can be seen running for rescue. Hence we can only HOPE if it survives… Let’s HOPE all

karthik
karthik

Chetan , As per my internal source in BSNL , They were asked to deploy 4G with 3G spectrum , where ever they have upgraded their BTS in Tamil Nadu Circle(There is less 3G handset users , who is having data plan.). When Govt provided spectrum they can add additional spectrum to the present. Time line given was before 31st march, before govt is planning to allocate spectrum to BSNL. For the same reason BSNL launched VoLTE service for the south zone customers. Suddenly the plan was set back now temporally by the Head office. I have speculation that is… Read more »

karthik
karthik

In 4G , Voice is just an application on data with VoLTE. So Bundled plans with Voice and Data is the future of a 4G and next level based growing industry. Charges at the present situation is due to lack of 4G by AVOID and BSNL operators in many places and significant amount of basic handset users. Like JIO Phone , Other operators has to come up with the solution to bring 4G devices with similar lighter UI(of 2G hansets) and some decent price, so that they can use the 2G spectrum for 4G. When many developed countries moved to… Read more »

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