• Deccan Chronicle
  • Andhra Bhoomi
  • Asian Age
  • ePaper
  •  Auto Refresh
Home

ePaper
Last Updated:09:35 AM IST | Saturday, Mar 06, 2021
  • Home
  • Politics, Plan And Policy
  • Markets
  • Companies
  • Economy
  • In Other News
  • Autos
  • Just In
Menu
  • Home
  • Politics, Plan And Policy
  • Markets
  • Companies
  • Economy
  • In Other News
  • Autos
  • Just In
Home > Companies > Vodafone Idea will shut in absence of govt relief: Birla
Companies
Vodafone Idea will shut in absence of govt relief: Birla
By  
PTI   , Published : Dec 6, 2019, 12:40 pm IST | Updated : Dec 6, 2019, 1:23 pm IST

We will have to shut shop, chairman Voda Idea Kumar Mangalam Birla said on a query about the course of action for the company.

Aditya Birla Group chairman Kumar Mangalam Birla. (Photo: File | PTI)
Aditya Birla Group chairman Kumar Mangalam Birla. (Photo: File | PTI)

New Delhi: Vodafone Idea Ltd, the India's third largest mobile service provider, will shutdown if the government does not provide relief on the liability it faces in past statutory dues following a Supreme Court order, its billionaire chairman Kumar Mangalam Birla said on Friday.

"If we we are not getting anything then I think it is end of story for Vodafone Idea," Birla said at the HT Leadership Summit when asked about the future of Vodafone Idea in absence of a government relief on payment of Rs 53,038 crore dues.

Birla's Idea Cellular and British telecom giant Vodafone plc's India unit had merged last year to compete with the onslaught of free voice calling and dirt cheap data unleashed by richest Indian Mukesh Ambani's Reliance Jio.

In the process, it accumulated Rs 1.17 lakh crore debt and had just weeks back posted corporate India's biggest loss after it provisioned for the liability arising from the Supreme Court upholding the government's position on what base should statutory liabilities be calculated.

"It does not make sense to put good money after bad. That would be end of story for us. We will shut shop," he said in a response when asked if Vodafone Idea will put in more money.

Market leader Bharti Airtel, Vodafone Idea and other telecom players have to pay as much as Rs 1.47 lakh crore in payment of telecom license fee and spectrum usage charge together with interest and penalty for past 14 years.

Both Airtel and Vodafone Idea have petitioned the government for relief in waiver of interest and penalty, which will halve the dues, and also filed a review petition in the Supreme Court.

Birla was however hopeful of a relief from the government not just for the telecom sector but the industry as a whole to pull out the economy from a six-year low GDP growth of 4.5 per cent.

"They (the government) have realised the fact that this (telecom) is a very critical sector. The whole digital india programme rests on this. This is a strategic sector," he said.

The government, he said, has publicly stated that it wants three players from the private sector and one player from the public sector.

"I think that we can expect much more stimulus from the government because it is required for the sector to survive. If we weren't getting anything then I think it is end of story for Vodafone Idea," he said.

The government had late last month deferred by two years the payment due to telecom companies for spectrum they bought in past auctions. This relief totalled Rs 44,000 crore for the industry but companies are expected to pay this due together with interest after the two year moratorium.

Asked about the specific relief sought, Birla said, "The big elephant in the room is AGR. Which is actually I think something which lies in the court of judiciary. I believe government can have a dialogue. This was a suit filed by the government against telecom service providers."

AGR refers to adjusted gross revenues, a percentage of which the telecom companies pay as statutory dues. The Supreme Court had upheld the government position that non-telecom revenues have to be included in the AGR for calculating dues.

"Since the government has won, it gives them headroom to talk to judiciary and try to find some of solution. I don't know which form or shape it takes," he added.

end-of
Tags: 
vodafone idea, kumar mangalam birla, aditya birla group
Location: 
India, Delhi, New Delhi
Latest From Companies
HUL CMD Sanjiv Mehta said the results show that the long-term structural opportunity of FMCG in India remains intact.

HUL Q1 net profit rises 5.7 pc to Rs 1,897 crore

The management of Radar has built and exited 3 different businesses themselves which helps the sensitise first time and even veteran entrepreneurs.

Radar India advisors scales a new high

The top seven cities of Delhi, Mumbai, Kolkata, Chennai, Hyderabad, Pune and Bengaluru accounted for 4.45 billion km.

Delhi sees more night trips than Bengaluru, Mumbai, says Ola

Most Popular

Mukesh Ambani 9th richest on Forbes' real-time billionaires list
Top credit card myths harmful for your financial well-being
Microsoft CEO Satya Nadella tops Fortune's Businessperson of the Year 2019
Employment growth slowed down in last two years: report
GST structure: key challenges and its solutions

Editor's Picks

Income tax e-filers drop by over 6.6 lakh in FY19: Official data
Swiping on your smartphone reveals a lot about you to your social media company
  • Read Financial Chronicle as it appears in print.
  • Subscribe, and get it delivered in the inbox everyday.
  • Politics, Plan And Policy
  • Markets
  • Companies
  • Economy
  • In Other News
  • Autos
  • Just In
  • Home
  • About Us
  • Contact Us
  • Terms of Service
  • Privacy Guidelines
  • Copyright © 2019 Financial Chronicle, All rights reserved
Developed & Maintained By Daksham