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Reliance Jio, Vodafone-Idea, Bharti Airtel Pay Over Rs 4,500 Crore In Spectrum Dues

Telecom operators Reliance Jio Infocomm Ltd., Vodafone Idea and Bharti Airtel Ltd. have paid over Rs 4,500 crore to the Telecom Department in spectrum dues in the last three to four days, according to sources.

Sources said that the payments came in before the due date. The sparring telcos — some of which are reeling under acute financial stress and are seeking immediate relief measures — have made the payment towards deferred spectrum liability (or installment payment for radiowaves bought in past auctions) which fell due on Oct. 21.

While Mukesh Ambani-led Reliance Jio has paid Rs 1,133 crore to the Department of Telecom, Vodafone Idea has made Rs 2,421 crore payment towards spectrum dues. Sunil Mittal’s Bharti Airtel has paid Rs 977 crore. Taken together, these three players have paid over Rs 4,531 crore towards spectrum dues late last week.

Emails sent to Reliance Jio and Airtel went unanswered, while a Vodafone Idea spokesperson said that the company does not comment on matters that are business as usual. The government, in March last year, enhanced the number of annual installments for spectrum payment from 10 to 16 years to provide a breather to the debt-laden telecom sector.

But with the industry reeling under financial stress, Vodafone Group Chairman Gerard Kleisterlee and CEO Nick Read recently met Telecom Secretary Anshu Prakash, as the company sought a two-year moratorium on deferred spectrum payments, and other relief measures from the government. The British telecom giant has asserted that it is focused on the successful integration of business between Vodafone and Idea.

The telecom sector has been battered by falling tariffs, eroding profitability and mounting debt in the face of stiff competition triggered by disruptive offerings of Reliance Jio. The industry has been seeking urgent relief such as the cut in levies like license fee and spectrum charges, and release of Goods and Services Tax input tax credit locked up with the government.

In a sector stung by policy and regulatory issues, battlelines have been drawn more recently over the contentious matter of call connect charges, where the regulator is reviewing whether or not the zero termination charge regime should be pushed back from the originally-stated timeline of Jan. 1, 2020.

Reliance Jio has alleged that any review of call connect charges by Telecom Regulatory Authority of India “sabotages” the Prime Minister’s vision for Digital India, and will hit not only the regulator’s credibility but also investor confidence as the move protects vested interests of some old operators. Bharti Airtel has favoured continuation of call connect charges till 2022.

Vodafone Idea and state-owned BSNL too have favoured levying of the interconnect usage charge, currently 6 paise per minute, on every incoming call from the network of other operators.―Bloomberg Quint

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