Government's Lifeline to Vodafone Idea: Relief Package Approved

The Indian government has approved a major relief package for Vodafone Idea by freezing its outstanding AGR dues, offering a five-year payment moratorium, and allowing reassessment of statutory charges. This move is aimed at securing the company’s long-term survival amidst financial strain due to competition and high debts.

The Indian government on Wednesday sanctioned a crucial relief package for Vodafone Idea, effectively freezing its outstanding AGR dues and offering a five-year moratorium on payments. This decision provides a critical lifeline to the financially beleaguered telecom company.

The Union Cabinet's measures, driven by a desire to protect the interests of its 48.9% stake in the telco, ensure the orderly payment of spectrum auction charges, uphold competition, and safeguard the interests of 200 million Vodafone Idea consumers. The government has pledged continued support to stabilize the sector.

AGR dues will remain frozen at Rs 87,695 crore, with payment commencing from the fiscal year 2031-32 and culminating by 2040-41. This move comes after a favorable Supreme Court verdict that permits the reassessment of AGR demands raised up to FY 2016-17, reflecting a significant policy turning point for the sector.

(With inputs from agencies.)