Voda Idea, Airtel need no relief: Jio to RS Prasad

KOLKATA: Reliance Jio Infocomm has asked telecom minister Ravi Shankar Prasad to reject demands to grant relief to Bharti Airtel and Vodafone Idea on payment of statutory fees based on adjusted gross revenue (AGR), saying its two rivals have the capacity to meet their financial obligations.

However, the Mukesh Ambani-led telco urged the government to consider “other industry issues of prospective rationalisation of levies and taxes and GST credit separately.”

Jio said in a letter dated October 31 that Prasad should not permit the Cellular Operators Association of India to mix the investment-infusing financial package for the telecom industry with the legitimate licence fee and spectrum usage charge obligations arising out of the past conduct of Airtel and Vodafone Idea.

In its second letter in as many days on the topic, Jio said the tone of a COAI letter to Prasad dated October 29 was “threatening and blackmailing” and “borders on contempt of the recent apex court AGR judgement” directing operators to clear their dues in three months.

“We request the government to reject COAI’s demand for financial relief… all operators should be mandated to deposit the applicable amounts within three months,” Jio said.

It said Airtel and Vodafone Idea have “sufficient financial capacity and enough monetisation possibilities to comfortably pay the government dues”.

Granting any such relief package, which prima facie appears to mitigate perceived financial strains, is likely to raise similar demands from other sectors such as aviation, Jio said.

“There is no constraint of making funds available to pay off their legal obligations,” Jio wrote.

It said both its competitors have stakes in profitable ventures in the country and abroad and have divested assets in profitable tower ventures such as Indus Towers and Bharti Infratel. The operators also have principals with sound financial positions.

The Supreme Court last week upheld the government’s definition of AGR to include revenue from the non-core activities of telcos. Consequently, Vodafone Idea and Airtel may need to cough up over Rs 80,000 crore in licence fees and SUC, with penalties and interest.

COAI has said without relief such as a waiver on payment of penalties and interest, the two telcos could face an unprecedented crisis that could result in a monopoly in the sector already saddled with debt of over Rs 7 lakh crore.

A panel of ministry secretaries has been asked to suggest measures to grant relief to the sector.