Reportedly the latest Delhi winter is the coldest in 118 years. Maybe partly due to the chilling effect of the end-October 2019 judgement of the Hon’ble Supreme Court of India in the telecom Adjusted Gross Revenue (AGR) based levies. The ruling gave such a massive jolt to the telecom sector, which had already been teetering for quite a few years at the brink of a precipice that it plunged into the killing financial quicksand at the bottom.
The payment demand on the decreed pending dues of four telcos—Bharti Airtel, Vodafone Idea Limited (VIL), Tata Teleservices Limited (TTSL) & Reliance Jio Infocomm Limited (RJio)—with interest and penalty, is actually much more than their AGR for FY19.
If easy payment term at NPV is allowed, it still does not improve business viability as it keeps the full liability on the books, and just helps cash flow. Further, even if payment is amortized over 15 years, EMI payments would amount to 14% of the yearly AGR of these operators, which are additional to ongoing AGR-based levies and GST levies of about27%- a grand total of over 41%% of net revenues!
The sector contributes 6-7% to India’s GDP every year and has created world-class digital public communications infrastructure without even one rupee subsidy from the Government. Other than direct revenue contributions to exchequer, the spill-over effects of the sector are enormous. As per ICRIER report, a 10% increase in mobile penetration delivers a 1.9% increase in the rate of state GDP growth. Further, a 10% increase in internet subscriptions results in a 3.2% increase in output.
This story is from the March,2020 edition of Voice and Data.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the March,2020 edition of Voice and Data.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.
Already a subscriber? Sign In
Navigating Social Media Risks With AI
Amidst the complexities of social media, harness the power of Al to protect privacy, enhance mental health, and combat misinformation effectively
V&D leadership forum explores the future of a connected world
The TLF was attended by 250+ technology and business decision-makers and policymakers across the communication and broadcasting sector
Data, chips, and India's AI mission
The Rs-10,372-crore initiative seeks to position the country as a global Al powerhouse, enhancing its capacity for research and innovation
Where jellyfishes work better than whales
Edge Distributed Computing is revolutionising Supercomputing, offering agility, cost-effectiveness, and real-time decision-making
The unexpected shift
Disillusioned from the Cloud, more organisations are now looking at cost-effective, secure prefab containerised Edge Data Centres for business agility
The Silicon game: Reaping 5G gold
In-built hardware can be a big amplifier for 5G adoption, reshaping connectivity paradigms and fuelling innovations in telecom, IoT, and beyond
New video streaming to shake up the data market
D2M technology paves the way for data-free video streaming, offering broader content access while potentially unsettling the telecom sector
Pathbreakers of the Year (2023)
The vision, determination, and groundbreaking initiatives of three discerning telecom industry leaders have been pivotal in laying the foundation for the seamless deployment of the world's largest 5G networks within record time.
Lifetime Achievement (2023)
Aluminary in India's telecommunications landscape, Mukesh D Ambani stands as a beacon of transformative leadership.
Telecom Person of the Year (2023)
A bureaucrat par excellence, K Rajaraman's visionary leadership has been instrumental in driving domestic telecom equipment manufacturing and streamlining decision-making processes within the DoT.
