Only Vodafone Idea Stands To Benefit From India’s Plan To Offer AGR Dues Relief

Debt-laden Vodafone Idea Ltd. is the only telecom operator that stands to benefit from the government’s plea in the Supreme Court seeking permission to allow wireless carriers pay statutory dues worth thousands of crores over 20 years.

Vodafone Idea—which has so far deposited only Rs 6,854 crore, or 32 percent of its self-assessed dues—will benefit from this plea if its self-assessment stands as the final amount to be paid, according to BloombergQuint’s calculations. For Vodafone Idea, the balance amount payable over the next 20 years is Rs 14,679 crore, which works out to instalments of Rs 1,495 crore including interest.

That comes after the telecom ministry proposed the staggered payment of adjusted gross revenue dues in view of the current economic condition of the industry and impact it will have, including on consumers and job losses, if one of the operators decides to file for bankruptcy, according to an affidavit filed in the apex court. The firms have also been asked to pay annual interest rate of 8 percent on the said amount.

Bharti Airtel Ltd. had earlier said it has fully paid AGR dues to the government, based on its self-assessment. The telecom operator said it has also made an additional Rs 5,000 crore ad-hoc payment to cover differences that may arise with telecom department. Tata Teleservices Ltd. and Reliance Jio Infocomm Ltd. have also paid their entire dues.

According to the affidavit, the final AGR dues will be based on reconciliation between telecom companies’ self-assessment and DoT’s assessment.

For the telecom department to calculate the amount, the documents will have to be provided by the telecom service providers. As the telecom companies have made their assessment based on these papers, the final amount payable is likely to be close to their assessment.

―Bloomberg Quint