Nonsense! The telecom mess in a word

Last October the Supreme Court had ruled in favor of the government’s definition of adjusted gross revenue and accordingly ordered telecom operators to settle liabilities accrued over 14 years within three months. These came to upwards of a whopping Rs 50,000 crore for Vodafone, over Rs 35,000 crore for Airtel and Rs 60 crore for Jio. The government itself couldn’t fail to recognize the onerousness of this burden. In November it gave the debt-stricken telcos a two-year moratorium on spectrum payments, to free some cash flow for payment of AGR dues. In January it decided “not to take any coercive action against the licencees in case they fail to comply with the Supreme Court order”.

Today the Supreme Court has had strong words against this non-compliance of its AGR order: “We don’t know who is creating this nonsense, is there no law left in the country… It is better not to live in this country and rather leave the country.” The Centre has been told to withdraw its January order and the telcos have been told to deposit the AGR dues by March 17.

It is clear that government Band-Aids will not suffice to address this crisis. A proper policy fix, perhaps including a retrospective tax change, is needed here. Because what if another and yet another telecom company were to actually exit the country? As it is India is now down to just three private telecom players, in significant part due to haphazard policymaking and sweeping judicial verdicts. Continuing down this road could press the destruct button on the Indian telecom sector precisely when it needs to deliver the critical 5G transition for powering ahead in the 21st century.

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DoT orders telcos to clear dues by midnight

NEW DELHI: The department of telecom (DoT) on Friday ordered telecom companies Bharti Airtel, Vodafone Idea and others to pay their AGR (adjusted gross revenue) dues by 11:59 pm today. The DoT, which faced the ire of the Supreme Court for putting on hold recovery of dues from telecom companies, […]

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