Indian operators hold back payments for another week

Indian operators hold back payments for another week

As we suggested earlier this week, Indian operators Bharti Airtel and Vodafone Idea have told the country’s Department of Telecommunications (DoT) that they will not pay an estimated $12.4 billion between them in adjusted gross revenue (AGR)-related fees due today as they are awaiting next week’s Supreme Court hearing relating to a modification petition. 

Both companies are hoping that the Department of Telecommunications will give them time to make payment, depending on the outcome – with which they say they will comply – of their petition. However, third operator Reliance Jio Infocomm has now paid its statutory dues – a more modest sum in the million of dollars – to the government.

These liabilities arose after India’s Supreme Court held in October that non-telecom revenues have to be considered for calculating statutory dues.

While the government has directed the operators to make the payments in accordance with the October ruling, and to submit the requisite documents within the stipulated time frame (neither of which has happened), it seems no coercive action is to be taken against the telecomunications companies to force payment, the DoT evidently preferring to wait for next week’s verdict.

Meanwhile, with rather unusual timing given all the ongoing AGR issues, Bharti Airtel is saying goodbye to its chief regulatory officer. Ravi Gandhi has decided to step down from the position. Reports suggest he will leave in early March, having been with Airtel since 2008. No reasons or further details have been made available.

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