Industry body COAI is pitching for a 10-15 year payment schedule for telecom companies to pay their past statutory dues, beginning with part-payment upfront and a two-year moratorium.
This formula of easier payment schedule to meet statutory obligations would offer the much-needed reprieve to telcos such as Bharti Airtel and Vodafone Idea, whose combined liabilities after the recent SC verdict run into billions of dollars, according to the Cellular Operators’ Association of India (COAI).
COAI Director General Rajan Mathews said the industry requires a debt package for payment of past statutory dues with a two-year moratorium, as in the case of payment made for spectrum bought in auctions.
“Give telecom companies 10-15 years for payment of the full adjusted gross revenue (AGR) dues, a two-year moratorium and an interest rate at interbank borrowing rate levels that is at around 4-5 per cent,” Mathews said.
There could be an upfront payment of about 15 per cent, which is equivalent of the principle AGR amounts, he added.
“The government will easily get Rs 15,000-20,000 crore (£1.6-2.1 billion) only through upfront payments from large operators,” Mathews said.
This will be a “reasonable” payment schedule for the crisis-ridden telecom industry, as it would allow them to invest money into network expansion and new technologies, the COAI said.
Fifteen telecom companies owe the government Rs 926 billion in unpaid licence fee and another Rs 550 billion in outstanding spectrum usage charges. These liabilities arose after the Supreme Court in October last year held that non-core revenues have to be considered for calculating statutory dues from adjusted gross revenue (AGR).
In the case of Bharti Airtel, the liabilities added up to nearly Rs 356 billion, of which Rs 217 billion is licence fee and another Rs 139 billion is the spectrum usage charge dues (not including the dues of Telenor and Tata Teleservices).
Vodafone Idea, which is staring at unpaid statutory dues of Rs 530 billion, including Rs 247 billion of spectrum dues and Rs 283 billion in licence fee, has already warned of shutdown if no relief is given.
Bharti Airtel, Vodafone Idea Ltd, and Tata Teleservices have, meanwhile, jointly filed a modification application in the Supreme Court seeking more time to pay the statutory dues.
The fresh plea for relief on the payment schedule came after Supreme Court, earlier this month, dismissed the review petitions filed by telecom companies against the apex court’s October 24, 2019, verdict.
