Blessing In Disguise For Vodafone, Airtel As Connectivity Takes Priority Over AGR Dues

For Bharti Airtel, Vodafone-Idea and other telecom players that owed huge adjusted gross revenue (AGR) dues and had to increase their tariffs in order to stay afloat, the nationwide lockdown for 21 days has come as a relief.

The current focus for the Department of Telecom (DoT) is on the telecom infrastructure as millions of people are working from home, and healthcare services also require 24×7 connectivity. DoT has to now set aside issues related to AGR dues and concentrate on ensuring that there is a smooth running of operations.

Once the largest player in the Indian market, Vodafone Idea owed the department of telecommunications (DoT) more than INR 40K Cr in dues related to adjusted gross revenue (AGR). The SC had given a deadline of January 23, 2020, to the company for clearing the dues. All the telecom companies together owed more than INR 1 Tn to DoT.

Vodafone Idea was on the verge of bankruptcy as it could not meet the deadline and the apex court had called out the company. Chairman of Aditya Birla Group Kumar Mangalam Birla had said that if the government doesn’t provide any relief to the company then it will be left with no option but to “shut shop”.

According to experts, this gives the telecoms an opportunity to improve their services and streamline operations. “There have been no notices sent to telcos on their AGR payments or any discussions on it. Right now, all the focus of the DoT is on how to ensure the smooth running of operations during the Corona pandemic,” a government official was quoted as saying by India Today.

Like any other industry, it is a tough time for telecom as well. Many conferences and meetings are moving online and consumers have started facing issues with connectivity. Ensuring smooth functioning in the backdrop of the sudden increase in the internet needs has become the topmost priority for telecoms.

Meanwhile, Bharti Airtel has also now come up with a proposal to address the issue. The company has asked Reliance Jio, Vodafone Idea and state-owned Bharat Sanchar Nigam Limited (BSNL), and Mahanagar Telephone Nigam Limited (MTNL) to come together and help people get uninterrupted internet facilities.

The partnership of all these players can be facilitated through intra-circle roaming (ICR) agreements. This arrangement aims to help users to get wider coverage of 2G, 3G, and 4G services. It is also expected to provide better internet access to consumers under roaming and not in their registered network circle.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.