Left Menu
Development News Edition

Grant 3-year moratorium, extended timelines for payment of all dues: COAI to govt

PTI | New Delhi | Updated: 18-11-2019 16:37 IST | Created: 18-11-2019 16:09 IST
Grant 3-year moratorium, extended timelines for payment of all dues: COAI to govt

The government should grant telecom companies a three-year moratorium followed by an extended timeline for payment of all statutory dues at easier interest rates, as the telecom sector is reeling under massive losses after the Supreme Court ruling on AGR liabilities, COAI said on Monday. Cellular Operators Association of India (COAI) Director General Rajan Mathews told PTI that operators need "oxygen" and urged the government to take a call on debt restructuring of all the dues that telecom operators owe to the government.

Mathews said most 4G licences have 11-year validity left, and that the government could pack in another 10 years, thus allowing operators to pay back all the outstanding dues spread over the entire licence period. "It is also time to redefine AGR (adjusted gross revenue) prospectively," Mathews said.

The telecom industry has been haemorrhaging, with combined losses of listed mobile network firms surpassing Rs 1 lakh crore in the September-ended quarter. Last week, India's two leading telecom operators Vodafone Idea and Bharti Airtel reported a combined loss of Rs 74,000 crore for the second quarter ended September 2019, mainly on account of statutory dues arising from the recent Supreme Court order on AGR.

The apex court upheld the government's position of including revenue from non-telecommunication businesses in calculating the annual AGR of telecom companies, a share of which has to be paid as licence and spectrum fee to the exchequer. The ruling over statutory liabilities has triggered a rush for provisioning by telecom companies. While Vodafone Idea posted a loss of Rs 50,921 crore, the highest-ever quarterly loss by any company in India, Airtel reported a loss of Rs 23,045 crore.

On Friday, Reliance Communication posted a consolidated loss of Rs 30,142 crore for the July-September 2019 period due to provisioning for liabilities after the Supreme Court ruling on statutory dues -- marking second-highest loss posted by any Indian company till date. Airtel, Vodafone Idea and other telecom operators have to pay the government a whopping Rs 1.4 lakh crore following the Supreme Court order that has sent shock waves through an industry already grappling with past losses and billions of dollars in debt.

According to latest estimates by the telecom department, Bharti Airtel faces a liability of around Rs 62,187 crore (including share of Tata Group of companies and Telenor India), while Vodafone Idea may have to pay about Rs 54,184 crore. The remaining liability is with state-owned BSNL and MTNL and some of the shut or bankrupt telecom companies. Stung by colossal losses, Vodafone Idea has said its ability to continue as a going concern is dependent on obtaining relief from the government and positive outcome of the proposed legal remedy. The company is also in the process of filing a review petition against the Supreme Court order.

The Department of Telecommunications (DoT) had shot off notices to telecom operators to pay their revenue share dues within three months as directed by the Supreme Court. The DoT has given the option to telecom operators to clear all the dues on a self-assessment basis. Last month, the government also constituted a committee of secretaries to explore a financial bailout package for the telecom sector.



Turbulence surrounding tobacco control in Ghana

... ...

Smart healthcare: IoT redefining the way healthcare is delivered

As the world is embracing the new wave of digitalization triggered by the pandemic and the arrival of 5G, the adoption of IoT devices will further boom. With adoption set to soar, IoT security issues and other challenges cant be ignored any...

Refugee compassion and response: Ideas to mitigate disasters now and in their future

Their homeland becomes a forbidden territory for them and more likely than not, their journey to foreign soil is no less traumatizing, not to say deadly. It is crucial to help refugees live a life of dignity and purpose....

Inadequate water infrastructure causes a tidal wave of coronavirus in rural Alaska

... ...


Latest News

Amazon's cloud service back up after widespread outage

Amazon.com Incs widely used cloud service, Amazon Web Services AWS was back up on Thursday following an outage that affected several users ranging from websites to software providers. We have restored all traffic to Kinesis Data Streams via...

Awareness needed to conserve monuments in Marathwada: Experts

Conservation work at forts of Marathwada should be carried out without wiping out historical remains at the sites, experts said during a webinar organised by the Maharashtra state archaeology department, an official said on Thursday. The we...

Xiaomi Mi 10T Pro 5G down to just £399 for Black Friday

Xiaomis newly-launched budget flagship, the Mi 10T Pro 5G, is becoming more affordable as the device will be available for just 399 on Amazon as part of the Black Friday deal.The Mi 10T Pro 5Gs 8GB256GB model will be going on sale tomorrow ...

West Bengal minister volunteers for COVID-19 vaccine trial

West Bengal Urban Development Minister Firhad Hakim has expressed his wish to be a volunteer for the Covaxin Phase III trial scheduled to be held at the city-based National Institute of Cholera and Enteric Diseases NICED. The 62-year-old mi...

Give Feedback