More AGR relief measures discussed by Indian government

More AGR relief measures discussed by Indian government

According to Indian news reports, the government is considering setting up what it calls an empowered group of ministers (eGoM). Its role? To manage the adjusted gross revenue (AGR) crisis now affecting a number of telecommunications companies.

Among the group’s functions – if indeed it is set up – will be to examine ways to bring down licence fees and spectrum usage charges, among other levies.

Of course, a lot of the difficulties telecommunications companies are dealing with stem from Supreme Court judgements, and the government may, according to sources quoted in the Indian press, ask the Court to allow staggered payment of AGR liabilities over a long period – at present value and reduced interest rates.

A number of other ways forward are being discussed but, in theory, they will have to wait until the Supreme Court hearing on March 17 when it agrees – or not – to allow talks on spreading payments over a number of years. There is a fair amount of urgency related to the consideration of these measures, not least because of worries about bank defaults, the effect on inward investment and the potential for job losses if Vodafone Idea in particular collapses.

Ironically, however, the Supreme Court hearing may now be delayed – not for political reasons but because of precautions taken over the Coronavirus outbreak.

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