Vodafone Idea To Get Big Relief? Centre Weighs Options, Stands Firm Against Duopoly
The government is actively examining ways to support Vodafone Idea, which is facing acute financial stress following the Supreme Court's dismissal of its plea on adjusted gross revenue dues.
Top government sources have told NDTV Profit that the Centre remains committed to maintaining healthy competition in the telecom sector and is firmly against the emergence of a duopoly.
According to officials, the government is currently evaluating two to three possible measures, including a moratorium on pending AGR payments. These discussions are being held in coordination with the Department of Telecommunications, which is assessing the legal and financial viability of each option.
Under Consideration
Giving moratorium on AGR dues.
Asks banks to give fresh credit.
One proposal under serious consideration involves asking banks to extend fresh credit to the telecom operator. In return, the government may offer concessions to lenders, aimed at de-risking their exposure to the telecom sector.
What sets Vodafone Idea's case apart is the government's 49% equity stake in the company, acquired as part of a previous relief package that converted interest dues into equity. This unique shareholder position has prompted the government to treat Vodafone's situation differently from that of other private players like Bharti Airtel, a senior official told NDTV Profit.
"While all telcos are impacted by the AGR liability, Vodafone's structure and government shareholding mean its case requires a more nuanced approach,” a senior official said.
Despite the current financial challenges, Vodafone Idea has submitted projections suggesting performance visibility and operational improvement in the next three to four years, adding a layer of optimism to the ongoing discussions.
While no final decision has been made yet, sources confirm that the government is will soon take a call on the matter.
Vodafone Idea owes Rs 83,400 crore in AGR dues to the government and had sought a waiver on over Rs 45,000 crore comprising interest, penalty, and interest on penalty.
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