Government likely to reduce licence fees of telcos, says report

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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The centre may soon reduce license fees of telecom companies from 8 percent to as low as 5 percent, reported The Economic Times, citing senior government officials. The move, the report added, comes as part of the government’s initiative to revive the struggling sector plagued by heavy debts.

According to the government officials cited in the report, a high-level meeting will be held this week to take a call on scaling down the licence fees, which, as per experts, will save the three network providers a combined Rs 4,000 to Rs 5,000 crore.

However, the report, citing experts, said that while the move could give some relief, it would not be enough to get Vodafone Idea and Bharti Airtel’s balance sheets out of danger.

Vodafone Idea and Bharti Airtel are having dues of over Rs 53,000 crore and Rs 35,000 crore respectively due to widening of the definition of adjusted gross revenue (AGR) by the Supreme Court.

“The government cannot do anything about the AGR dues, which has been decided by the Supreme Court. From the initial suggestions of relief measures, a licence fee cut will be taken up now following the two-year spectrum moratorium already announced,” a senior official was quoted as saying in the report.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow