Vodafone CEO Nick Read on Friday met IT and Telecom Minister Ravi Shankar Prasad to discuss relief options to keep the company afloat in India. He also met Finance Minister Nirmala Sitharaman at the Parliament House earlier in the day. News agency PTI quoting government sources said that Vodafone CEO Nick Read has told the government that the company wants to make a new, good beginning in India.
The meetings come at a time when Vodafone Idea Ltd faces questions on its survival in India as Supreme Court mounts pressure on the UK-based telecom giant. Sources also said Ravi Shankar Prasad made it clear that the government is against monopoly in the telecom sector and wants Vodafone Idea to survive & remain invested in India. The sources added that the relief measures for telecom firms is a work in progress.
The sources said that Ravi Shankar Prasad conveyed India's growing economic clout and its attractiveness to foreign investors, as also the enormous size of its market. The minister pointed out that the company has 30 crore subscribers in India and that the telecom market presents huge opportunities. India wants fair competition, the minister is learnt to have told the Vodafone CEO.
Sources said Read also acknowledged that the AGR issue should have been addressed long back by the company. It is learnt that Vodafone Idea will have to pay at least the principal amount of its AGR dues at the earliest.
Telecom companies are desperately waiting for a bailout package from the government after a Supreme Court order put their statutory liabilities at Rs 1.47 lakh crore, and all eyes have been on Department of Telecommunications for the much-needed breather to fix the AGR problem. Vodafone Idea is the worst hit by the verdict with over ₹50,000 crore in past dues. It has so far paid just ₹3,500 crore in AGR dues to the DoT.
Vodafone Idea Ltd (VIL) recently told the government that it would not be able to pay the full dues unless state support is extended to survive the crisis. It had made a strong plea for setting off Rs 8,000 crore of GST credits, a three-year moratorium on payment of the remaining amount which should be staggered over 15 years at a simple interest rate of 6%, a drastic cut in licence fee and fixing of a minimum price of calls and data.
The intensity of crisis being faced by VIL can be gauged from the fact that Vodafone Idea Chairman Kumar Mangalam Birla has held multiple rounds discussions at the telecom ministry and finance ministry over last few weeks to look for a solution to keep the telecom operations on track.
In December, Birla had said VIL may have to shut if there is no relief on the statutory dues. "If we are not getting anything, then I think it is the end of the story for Vodafone Idea. It does not make sense to put good money after bad. We will shut shop," Birla had said.
(With agency inputs)