Big relief to telecom industry from AGR exemption, Vi and Airtel will benefit

By News Update On Jan 19, 2025

The government is considering providing relief to private telecom companies like Airtel and Vodafone-Idea (Vi) in their adjusted gross revenue (AGR) dues. Under this proposal, the government is planning to give 50% rebate in interest and 100% rebate in penalty. This will especially provide relief to Vodafone-Idea, which has been facing huge losses for a long time. Apart from this, Airtel will also benefit a lot from this decision.

It is noteworthy that after an order of the Supreme Court in 2019, this matter was under consideration of the government. If this proposal is passed, the monopoly of a few companies on the telecom sector in the country may end.

Benefit of financial assistance of Rs 1 lakh crore
According to an Economic Times (ET) report, if this proposal is finalised, telecom companies may get financial relief of more than Rs 1 lakh crore.

Vodafone-Idea (Vi) will benefit the most from this.
Telecom companies can start paying AGR dues to the government from financial year 2026.
AGR dues: Jio has no problem
Vi's AGR dues may reduce by Rs 52,000 crore.
Airtel may get relief of around Rs 38,000 crore.
Tata Teleservices will benefit up to Rs 14,000 crore.
At the same time, there is no AGR outstanding on Reliance Jio, due to which it will not get any direct benefit from this decision.
Big announcement may be made on 1st February
The proposal for exemption in AGR is under discussion in the Finance Ministry, Department of Telecommunications and Cabinet Secretariat. It is believed that the government can announce this relief while presenting the budget on 1 February 2025. This step will be the second major decision of the government after the September 2021 relief package.

In 2021, the government had abolished the requirement of submitting bank guarantee for spectrum dues, which was a big benefit to Vi.

Vi will benefit greatly
If this proposal is passed, Vodafone-Idea (Vi) will get a chance to strengthen its 4G and 5G networks. This move will help Vi to compete with Jio and Airtel. This will bring new life to the telecom industry and consumers will be able to get better services.