NEW DELHI: The Digital Communications Commission (DCC), the telecom sector’s top policy-making body, has failed to arrive at any decision on providing relief to beleaguered telecom service providers. According to sources, the panel could not take a final call during its meeting on Friday since it “requires more data” on liabilities arising from the Supreme Court’s AGR judgement last year.
The apex court had ordered over a dozen companies to pay a cumulative Rs1.47 lakh crore in pending dues after it held that Adjusted Gross Revenue (AGR) should include proceeds from licence-holders’ non-telecom businesses too.
AGR is the basis on which levies like license fees and spectrum usage charges (SUC) are calculated and the worst affected by the judgment are Vodafone Idea (VIL), Bharti Airtel and Tata Teleservices who owe Rs53,038 crore, Rs35,586 crore and Rs 13,823 crore respectively, according to DoT estimates. All three firms have made only partial payments so far of Rs 3,500 crore, Rs 10,000 crore and Rs 2,197 crore respectively.
While telecom department officials maintained that the AGR issue was not the focus of the Friday meeting, with issues like the Bharat Net project holding centre-stage, sources note that the panel is awaiting more detailed information on the claims.
“The committee is likely to meet again soon to deliberate on this matter,” an official source said. The DCC’s members include top officials from the ministries of telecom, finance, commerce, and electronics & IT, as well as the NITI Aayog CEO.
While Airtel is well capitalised to meet its liabilities, VIL has repeatedly warned that paying its AGR dues in one-go would likely lead to its insolvency.
In fact, both VIL and the Cellular Operators Association of India had written to the telecom ministry just days earlier reiterating the critical need for relief, with measures sought including an 18-year period in which to pay dues, GST credit offsets and the implementation of a floor tariff price. The COAI has also reiterated requests to reduce license fees to 3 per cent from 8 per cent, SUC by 3 per cent, a GST waiver on sovereign payments and reviewing the need for bank guarantees.
Relief measures proposed by the COAI
In its letter to the telecom ministry, COAI has reiterated requests to reduce license fees to 3 per cent from 8 per cent, Spectrum Usage Charges by 3 per cent, a GST waiver on sovereign payments, and reviewing the need for bank guarantees.