Bharti Airtel and Vodafone Idea Unsure About Payment of Dues There is a term being thrown around by the telecom operators, and the companies are terming it as a matter of “going concern” meaning that the company has the ability to meet its financial obligations for the next 12 months. On this matter, the Sunil Bharti Mittal led telecom operator has said that it might not be able to raise additional funds to pay for the dues that have come up as the result of the new Supreme Court order on the matter of AGR. The company has also added that although the management could try to raise funds, but there could be no assurance about the extent to which the attempts to procure funds would be successful and whether or not it would happen in a timely manner. Analysts Express Concern Over Investing Scenario On the other hand, the analysts have also expressed concern over what signal the position of Vodafone Idea and Bharti Airtel would send to the global investors. Rohan Dhamija, telecom expert and partner at Analysys Mason, remarked, “When two companies — that were India’s top two telcos not too long ago are suddenly struggling to continue as going concerns, the signs are ominous, to say the least. The government must do something to provide relief to the sector in a balanced and fair manner, failing which global investor confidence in India’s telecom space is bound to suffer a serious setback.” Government In Talks for Relief The two telecom companies have to pay up to Rs 80,000 crore by the month of July, under three months as a result of the new Apex Court order. Bharti Airtel has provisioned for licence fee dues of Rs 16,815 crore and Rs 11,635 crore for SUC dues. The telecom companies have also asked the government for some relief in the dues. The appeal for relief from the government includes a waiver of interest and penalties on the AGR related dues, lowering of taxes and levies and a moratorium on the expected payments. There are also talks about filing a plea seeking a limited review of the AGR verdict. As per the talks that are ongoing in the industry, the government might lower the license fees on AGR down to 5% from the existing limit of 8%, while giving a moratorium of two years for the spectrum-related dues.
