Vodafone Idea urges government to set minimum mobile data tariff at Rs 35 per GB

Vodafone Idea has reportedly urged the government to set the minimum tariff rate at Rs 35 per GB of mobile data, which will be approximately 7-8 times of the current prices. For voice calls, it has urged the government to make it 6 paise per minute along with Rs 50 every month as connectivity charges from April 1.

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Vodafone Idea has sought 18 years to clear dues

The struggling telecom operator has made such requests to be able to pay the statutory dues and make its business sustainable again. The debt-ridden telecom operator is currently under severe pressure to clear off the adjusted gross revenue (AGR) dues of over Rs 53,000 crores in order to comply with a Supreme Court order. It has also requested 18 years to clear the dues with a moratorium of three years on payment of interest and penalty, as per reports.

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Vodafone attributes financial stress to below-cost pricing

In a letter to the department of telecommunications, Vodafone Idea stated that the root cause of the company’s financial stress has been the below-cost pricing structure of telecom services which had been forced upon them by competitive pressures in the industry.

The company also noted that there has been some increase in the market prices since December 2019; however, it believes that it is actually far from enough to cover their costs. It added that a further increase in price is unlikely if there are no grounds for regulating the prices, as the largest data player in the market is still priced much lower than other players in the telecom business. Bharti Airtel and Tata Teleservices are the other two telecom operators with major dues pending after Vodafone Idea.

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As reported by the Telecom Regulatory Authority of India (TRAI) in August 2019, 1 GB of mobile data which would cost Rs 226 in 2015 went all the way down to Rs 11 in just three years. As of now, Vodafone Idea subscribers pay as little as Rs 7.8 for 1 GB of mobile data per day with their 28-day plan priced at Rs 219, which also includes unlimited calling.

As for the company’s Rs 249 plan, it offers 1 GB data per day and costs a mere Rs 6, carrying a validity of 28 days. In contrast, its competitor Reliance Jio provides 1 GB of mobile data for as low as Rs 5 as part of their basic Jio plan.

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