The Union Cabinet has approved a relief package for Vodafone Idea, freezing adjusted gross revenue (AGR) dues at Rs 87,695 crore and granting a five-year moratorium. The move provides immediate financial relief to the debt-laden telecom operator, ensuring orderly payments and sustaining competition in India’s telecom sector.
Vodafone Idea Ltd received a significant breather as the Union Cabinet, chaired by Prime Minister Narendra Modi, cleared a long-awaited relief package. The decision freezes AGR dues and allows staggered repayment, aimed at stabilizing the financially stressed operator and protecting the government’s 49% stake in the company.
Key highlights from the announcement include
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AGR dues of Rs 87,695 crore have been frozen, payable over FY32 to FY41.
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Dues pertaining to FY18 and FY19 will be payable from FY26 to FY31 without change.
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The government has granted a five-year moratorium, easing immediate cash flow stress.
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The relief package is designed to protect the government’s 49% stake in Vodafone Idea.
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The move ensures a three-player competitive market alongside Reliance Jio and Bharti Airtel.
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Vodafone Idea employs over 18,000 people and serves nearly 198 million subscribers.
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Shares of Vodafone Idea traded nearly 10% lower at Rs 10.86 on the NSE following the announcement.
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Industry experts note that while the relief provides breathing space, fundraising and capital infusion remain critical for long-term sustainability.
The Cabinet’s approval underscores the government’s intent to stabilize India’s telecom sector by supporting Vodafone Idea. The relief package offers immediate respite but highlights the need for fresh capital and strategic restructuring to secure the company’s future.
Sources: News18, Moneycontrol, Economic Times, Business Upturn