Relief package: Bharti Airtel accepts moratorium on AGR, spectrum payments

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October 26, 2021 4:45 AM

Last week, Vodafone Idea had informed the DoT about its acceptance of the four-year moratorium for payment of its spectrum dues. It had said the decision regarding accepting the moratorium for the same number of years for AGR would be taken by its board by October 29, the deadline given by the government to the operators.

After October 29, operators have been given 90 days to confirm whether they would opt for paying the interest which accrues as a result of the deferral by way of offering equity to the government.After October 29, operators have been given 90 days to confirm whether they would opt for paying the interest which accrues as a result of the deferral by way of offering equity to the government.

Bharti Airtel has informed the Department of Telecommunications (DoT) about its acceptance of the four-year moratorium for payment of its adjusted gross revenue (AGR) and spectrum dues. Sources said Bharti sent its acceptance letter to the DoT on Friday.

Last week, Vodafone Idea had informed the DoT about its acceptance of the four-year moratorium for payment of its spectrum dues. It had said the decision regarding accepting the moratorium for the same number of years for AGR would be taken by its board by October 29, the deadline given by the government to the operators.

After October 29, operators have been given 90 days to confirm whether they would opt for paying the interest which accrues as a result of the deferral by way of offering equity to the government.

Earlier in an interview with FE, Bharti Airtel chairman Sunil Bharti Mittal had said the company will get a cash flow relief of about Rs 35,000-40,000 crore by opting for the four-year AGR and spectrum payment moratorium. He had said this amount would be invested back into the network for 5G etc.

“We will earn a cash flow of about Rs 35,000-40,000 crore. As a result, a lot of public market debt can be reduced. We will be able to invest the savings in cash flow into the industry and invest in technology. I can assure you the savings on the cash flow will not go into the dividend,” Mittal had said.

Regarding the clause that operators have the option to pay the interest amount in equity, he said the board would decide on this matter. “In the case of Airtel, the total amount of interest is Rs 7,500-10,000 crore,” he had said.

The moratorium was part of the government’s revival package for the telecom sector, which offered a combination of cash flow relief for the financially stressed operators as well as long-term measures like redefinition of AGR and scrapping of spectrum usage charge in future auctions.

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