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Survival of internet firms under threat, duopoly not good for market: ISPAI

PTI | New Delhi | Updated: 16-01-2020 19:46 IST | Created: 16-01-2020 19:46 IST
Survival of internet firms under threat, duopoly not good for market: ISPAI

Internet service providers on Thursday exhorted the government to step in immediately to review the definition of adjusted gross revenue (AGR) for the survival of the telecom sector as the Supreme Court dismissed a plea by telcos seeking review of its verdict on recovery of Rs 1.47 lakh crore. "It is going to be a disaster for the telecom industry. Dismissal of review petition will lead to duopoly situation which is not good for consumers. Small ISPs will not be able to survive unless government steps in to review AGR definition," Internet Service Providers Association of India President Rajesh Chharia told PTI.

The Supreme Court on Thursday dismissed the plea of telecom majors, including Bharti Airtel and Vodafone Idea, seeking review of certain directions of the apex court on recovery of past dues amounting to Rs 1.47 lakh crore from telecom service providers. The recovery of past dues by the government was based on adjusted gross revenue (AGR) of about Rs 92,000 crore.

The apex court on October 24 last year upheld the AGR definition formulated by the DoT and termed as "frivolous" the nature of objections raised by telecom service providers. A bench comprising Justices Arun Mishra, S A Nazeer and M R Shah did not find merit in the review plea.

Vodafonde Idea Chairman Kumar Mangalam Birla has already announced that the company will shut its business in India if it does not get any relief in the AGR case. Based on the SC judgement and submission made by the Department of Telecom, total liability on Vodafone Idea, this number stands at a cumulative Rs 53,038 crore, including Rs 24,729 crore of SUC dues and Rs 28,309 crore in licence fee.

In the case of Bharti Airtel, the liabilities added up to nearly Rs 35,586 crore, of which Rs 21,682 crore is licence fee and another Rs 13,904.01 crore is the SUC dues (not including the dues of Telenor and Tata Teleservices). Bharti Airtel too had expressed concern on continuity of business in light of AGR woes.

"Airtel has raised USD 3 billion for investment in infrastructure. Now most of it will go in paying up dues and services to consumers will suffer. Not only telecom companies, banks will also suffer as they have massive exposure to telecom firms. This will also lead to job losses. Government has to take some serious measures to resolve this crisis," Chharia said. Bharti Airtel, Vodafone Idea and other telecom companies owe the government as much as Rs 1.47 lakh crore in past statutory dues, according to data shared by the telecom minister Ravi Shankar Prasad in Parliament

Prasad said telecom companies owe the government Rs 92,642 crore in unpaid licence fee, and another Rs 55,054 crore in outstanding spectrum usage charges. In the case of Bharti Airtel, the liabilities added up to nearly Rs 35,586 crore, of which Rs 21,682 crore is licence fee and another Rs 13,904.01 crore is the SUC dues (not including the dues of Telenor and Tata Teleservices).

In the case of Vodafone Idea, this number stands at a cumulative Rs 53,038 crore, including Rs 24,729 crore of SUC dues and Rs 28,309 crore in licence fee.


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