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Govt should be less litigious with industry says Sunil Mittal

Telecom major Bharti Airtel’s Chairman Sunil Mittal on Monday said the government should be less litigious with the industry.

He said the Supreme Court order on the adjusted gross revenue (AGR) issue, which has come as a result of a government petition, has taken out a lot of money from the industry that could have been utilised for building telecom networks in rural areas and launching 5G technology.

Mittal was speaking at the launch of a book ‘Some Sizes Fit All’, written by Bharti Enterprises Vice Chairman Akhil Gupta.

Without naming Vodafone Idea, Mittal also raised doubts on its sustenance in the present situation.

‘Government should be less litigious with industry. My own stand is that once they lose a particular case at a particular level, they should not be necessarily forced to or compelled to take it…to the last point. Then it keeps on being into litigation forever,’ Mittal said.

The government had lost a case in the AGR matter before telecom tribunal TDSAT but it challenged the judgement before the Supreme Court and won.

The Supreme Court had in October last year upheld the government’s position on including revenue from non-telecommunication businesses for calculating the annual AGR of telecom companies, a share of which is paid as licence and spectrum fees to the exchequer.

The apex court ruling led to a liability of around Rs 1.47 lakh crore for telecom payers.

‘To my mind, the government needs to be a little bit more courageous in dealing with some of these litigation. If you look at… ‘Vivad se Vishwas’, it is a fantastic step in that direction. A similar situation has to be in roads, telecom, electricity. We have many, many issues. Telecom is one area where companies are more like law firms with antennas,’ Mittal remarked.

He said during the Atal Bihari Vajpayee government, there was a settlement done to resolve industry woes when Arun Shourie was the telecom minister.

‘A similar need is now where the government should sit with two players who are left. It is a very, very small number left for a country like India. But the financial stress is coming along, marketeers are saying we may be down to two companies in the private sector,’ Mittal said.

When asked about his remark on ‘two players’ being left in the telecom sector, he said unless the promoters of the third company bring in a very large amount of fresh capital, ‘the sustainability of investments in this sector by that company is going to be in difficulty.’ He said Bharti Airtel too had been hit by several issues but the company raised funds through qualified institutional placement (QIP), perpetual bonds, IPO in Africa and made concerted efforts to ensure that its balance sheet is healthy.

‘I think the third operator may want to do the same once the clarity from the court comes through. We are all hoping that there will be a long runway to make this kind of payment, which to my mind is huge and has put in extraordinary stress,’ Mittal said.

He said the statutory dues not only include payment to be made to the government but also penalties and interest on penalties.

‘I mean there is a large amount which has been sucked out of our industry which I would rather have gone into building 4G networks in rural and bringing out 5G. This is the set up of our country. We will have to bow in front of the order of the highest court of the land, the Supreme Court,’ Mittal said.

The apex court has reserved its order on a modification plea filed by the telecom operators seeking more time to clear the dues.

The Union Cabinet has approved a 20-year time period for companies to clear their AGR dues.

‘We will await the outcome of the court as to how much time is given to this industry. Time and all is not good because there is an interest meter which is running on this amount. It’s not coming for free,’ Mittal said.

He said the case is done but from now on, the government and industry should stop having more litigation in the sector.

‘Telecom is the vital spine of the digital world of India. This spine must be fed with nourishment,’ Mittal added. PTI

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