HIGH TAXES, LOW TARIFFS, AND a penalty levied by the Supreme Court (SC) have created the perfect storm for India’s telecom companies. As Bharti Airtel, Vodafone Idea, Reliance Jio (Reliance Industries is the owner of Network 18, the publisher of Forbes India) look for government forbearance in dealing with the ₹75,000 crore in penalties levied by the SC, based on its interpretation of the definition of annual gross revenues (AGR), there are indications that a one-time relief is unlikely to lead to a smoother ride ahead. The next year could see further stress on their balance sheets.
Vodafone Idea and Bharti Airtel are staring at an AGR liability of ₹25,000-₹55,000 crore (the difference is on account of the companies’ calculation and the Department of Telecom’s calculation). While they’ve deposited a part of the levy, both firms have indicated they need more time.
This story is from the March 13, 2020 edition of Forbes India.
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This story is from the March 13, 2020 edition of Forbes India.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
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