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Bharti Airtel, Vodafone Idea get relief from AGR dues amidst Coronavirus lockdown

Indian telcos like Bharti Airtel and Vodafone Idea have to cater to about 1.3 billion people who are currently under lockdown and are staying at home.

  • Published: March 26, 2020 10:50 AM IST
Vodafone Airtel

The spread of Coronavirus across the world has shaken many industries globally. This has also now affected the Indian Telecom sector. Prime Minister Narendra Modi recently announced a 21-day lockdown in the country to fight back the deadly virus. As more people continue to stay at home, another major problem arises for telecom service providers. Millions of people staying at home and using internet services at the same time. Indian telcos like Bharti Airtel and Vodafone Idea have to cater to about 1.3 billion users staying at home. Also Read - Xiaomi patents new mask with improved fit and protection amidst Coronavirus pandemic

This risks the internet infrastructure of the country. Now, the Department of Telecommunications (DoT) has reportedly subsided the issues of default in AGR payments. They will just be focusing on maintaining the digital infrastructure, catering to the needs of billions of people who rely on stable networks to work from home. The update will bring a huge relief to telecom players like Bharti Airtel and Vodafone Idea. Also Read - Coronavirus: Telecom operators urge DoT to offer free access to critical sites

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The Supreme Court took the matter of AGR dues into consideration on March 17, 2020. It slammed the telcos along with DoT officials. The Supreme Court stated that the DoT should not have allowed the telcos to self-assess their AGR dues. It added that self-assessment of AGR dues is Contempt of Court. The Supreme Court directed the telcos to pay their AGR dues as estimated by DoT without any further delays. Also Read - Coronavirus: Netflix, Hotstar, YouTube asked to stream in SD to ease bandwidth burden

The court, however, agreed for a deferred payment mechanism, which was scheduled to be heard in two weeks. However, since the entire nation is now in lockdown, the next hearing regarding AGR dues is unclear. As per telcos, a situation of duopoly and monopoly will disrupt the entire telecom industry at a time like this. Telecos have to focus on providing services to 1.3 billion people in India.

How much do telcos have to pay as per DoT estimation?

The DoT estimations point at a cumulative amount of Rs 1.47 lakh crore towards AGR dues. Vodafone Idea, the most affected telecom player, has to pay a sum of Rs 58,254 crore towards the dues. The telco giant had, however, just paid its self-assessed principal amount of Rs 6,854 crore. Meanwhile, Bharti Airtel has to pay Rs 43,980 crore out of which the self-assessed amount paid was Rs 18,004 crore. Tata Teleservices has to pay Rs 16,798 crore. It has cleared just Rs 4,197 crore.

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  • Published Date: March 26, 2020 10:50 AM IST

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