Telecom companies flag floor price and redefinition of AGR
New Delhi: Amid ongoing turbulence in the telecom sector, Trai Chairman on Wednesday met the heads of telecom companies (telcos), including Vodafone Idea CEO, to identify priority issues that will be taken up by the regulator in 2020.
Sources said floor price for tariffs and redefining adjusted gross revenue (AGR) prospectively were among key issues that were flagged by the industry representatives at the meeting on Wednesday. A section of the industry attending the meeting called for a regulatory intervention by the Telecom Regulatory Authority of India (Trai) on these issues to address the sector's woes.
The meeting between Trai and the operators assumes significance as the debt-laden and loss-making sector is reeling under massive financial stress, compounded by demand for Rs 1.47 lakh crore in unpaid statutory dues following a ruling by the Supreme Court last month.
The meeting aimed at setting the regulator's agenda for 2020, at a time when the industry is desperate for new relief measures.
Vodafone Idea, Bharti Airtel and others are staring at massive statutory payouts after the SC upheld the government's position on including revenue from non-core businesses in calculating the annual adjusted gross revenue (AGR) of telecom companies, a share of which is paid as licence and spectrum fee to the exchequer.
When contacted, Trai Chairman R S Sharma said, "We had a general discussion on issues to identify the priority areas for the next calendar year".
"The industry had given their inputs prior to the meeting and Trai also had identified some issues... So, we deliberated on both these lists and got inputs from industry on their thoughts. We have asked industry to give their written submissions on specific matters," Sharma said.
Trai will finalise a list of 6-7 issues that will be taken up by the regulator in the coming year, he said.
Sharma, however, refused to comment on the specific matters that came up for discussion.
Industry sources, however, said floor price for tariffs and redefinition of AGR figured prominently in the talks held at Trai on Wednesday. Sources said key officials of telecom companies including Vodafone Idea, Bharti Airtel, Reliance Jio as well as chairman and managing directors of state-owned telecom corporations BSNL and MTNL were present at the meeting.
Vodafone India Chief Executive Officer (CEO) Ravinder Takkar also attended the meeting at Trai. The telecom operator's AGR dues are estimated to be over Rs 53,000 crore.
Besides floor price and redefinition of AGR on a prospective basis, other issues that came up for discussion included infrastructure sharing and use of new technologies like blockchain in areas such as mobile number portability (MNP) and Know Your Customer (KYC).
Sources privy to the meeting said some in the industry officials felt that a consultation paper should be floated by Trai on redefinition of AGR as the industry is suffering in the aftermath of SC order on statutory dues.
The industry wants Trai to get into redefinition of AGR prospectively; the same has also been one of the key demands by industry body Cellular Operators' Association of India (COAI).
The telecom companies owe the government Rs 92,642 crore in unpaid licence fee, and another Rs 55,054 crore in outstanding spectrum usage charges -- these liabilities arose after the Supreme Court held that non-telecom revenues have to be considered for calculating statutory dues.
In the case of Bharti Airtel, the liabilities added up to nearly Rs 35,586 crore, of which Rs 21,682 crore is licence fee and another Rs 13,904.01 crore is the spectrum usage charges (SUC) dues (not including the dues of Telenor and Tata Teleservices). For Vodafone Idea, this number stands at a cumulative Rs 53,038 crore, including Rs 24,729 crore of SUC dues and Rs 28,309 crore in licence fee.
Bharti Airtel and Vodafone Idea have filed a review petition before the Supreme Court on the issue.
To offer a breather to the struggling telecom industry, the government last week decided to defer spectrum payment dues from telcos for two years. The relief granted by the government totalled to Rs 42,000 crore -- Rs 11,746 crore to Bharti Airtel, Rs 23,920 crore to Vodafone Idea and Rs 6,670 crore to Reliance Jio, although analysts maintain that the 2-year spectrum moratorium is only a part relief and that more measures are