The Centre is concerned about the cash strapped Vodafone Idea's (Vi) ability to pay its upcoming AGR payment due in March, with Department of Telecommunications (DoT) officials cautioning that the July 23 ruling by the Supreme Court (SC) has put a big question mark on the beleaguered telco's survival.
"Vodafone Idea has made its payments so far but there have been delays in some of the quarterly dues. But now there is a big question on survival," a senior official told the Economic Times, adding that the telco has a large chunk of spectrum installments due in a few months as well.
Vodafone Idea had written to DoT secretary Anshu Prakash on June 25 and sought another year - till April 2023 - to meet its statutory payment obligations to the tune of Rs 8,292 crore over spectrum bought in auctions.
"Now it depends if the government decides to provide the telcos with moratorium relief but that is not an easy option. How long and how many times can the government support one operator? And in the interim, how will the operator pay its dues?" another official told the publication.
Vodafone Idea also needs to look internally at its business operations in order to run it more competently, given how competitors Reliance Jio and Bharti Airtel are managing, the official added.
In addition to the spectrum payments, Vodafone Idea, which reported a net loss for the fiscal fourth quarter at Rs 6,985 crore, needs to pay up approx. Rs 9,000 crore to the DoT by March 2022 towards its first installment of AGR dues.
This, after the SC on Friday, refused to permit the telco to approach the DoT to rectify errors claimed by the company in the department's computation of AGR dues. Vodafone Idea had hoped that if the rectification was allowed, its AGR dues would be curtailed by half.
The telco owes the Centre Rs 96,270 crore in spectrum liabilities and Rs 58,254 crore in AGR dues, of which Rs 7,854 crore has already been paid. Vodafone Idea has self-assessed its dues at Rs 25,000 crore, about 43 per cent of DoT's demand.
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