Rs 600 crore AGR bill: Will have to shut shop in India, says US satellite broadband provider Hughes

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Published: February 25, 2020 6:30:15 AM

Sources said that the US-based firm in a letter to DoT member (Finance) has said that it has complied with all terms of licence conditions and had paid for it, including license fee for miscellaneous and un-licensed revenues in the past.

Besides, Hughes provides critical satellite network to the Indian navy, army and the railways, which would also be impacted. (Representative image)Besides, Hughes provides critical satellite network to the Indian navy, army and the railways, which would also be impacted. (Representative image)

US satellite broadband provider, Hughes Network Systems, which is part of Echostar, has raised a red flag before the department of telecommunications (DoT) stating that it would have to shut shop in India if it is forced to pay adjusted gross revenue (AGR) dues to the tune of Rs 600 crore, which the company claims is erroneously computed.

Sources said that the US-based firm in a letter to DoT member (Finance) has said that it has complied with all terms of licence conditions and had paid for it, including license fee for miscellaneous and un-licensed revenues in the past. “We have complied to Supreme Court judgement of October 24, 2019 on all counts except para 174, wherein it is mentioned to add IP-1 revenues to our CUG license revenue for AGR,” the company added.

In the letter to DoT, Hughes’ India president Partho Banerjee said, “The fact that IP-1 is a licence makes us exposed to a payment default to the tune of around Rs 600 crore, an astronomical sum, more than two times our net worth and three times our revenues”.

Urging DoT to look into the matter, Banerjee rued that absence of any support from government would “regrettably end a 25-year-old high technology telecom company in India”, taking down the services of more than 70,000 banking/ATM locations, 20,000 locations at petrol pumps and would also impact network implementation in thousands of gram panchayats under Bharat Net.

Besides, Hughes provides critical satellite network to the Indian navy, army and the railways, which would also be impacted.

When contacted, a company spokesperson said, “Hughes remains committed to India and will continue to provide high quality communications and technology services to its customers in India.”

Hughes was one of the earliest MNCs to enter the country in the 1990s and subsequently went on to make significant investments, setting up several companies in the communications and technology sectors. Hughes Communications India Pvt Ltd (HCIPL) has also, in partnership with ISRO, enabled the satellite broadband revolution in India that has helped play a pivotal role in linking Indian enterprises and government entities to the digital revolution, the spokesperson added.

Hughes operates sales and support offices worldwide and is a wholly owned subsidiary of EchoStar Corporation, a global provider of satellite operations.

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