Cabinet freezes Rs 87,695 crore AGR dues of Vodafone Idea for 5 years

The Union Cabinet on Wednesday, giving a major relief, approved a support package that freezes a large part of the debt-hit Vodafone Idea’s adjusted gross revenue (AGR) dues.

Vodafone Idea’s AGR dues amounting to Rs 87,695 crore have been frozen as of December 31, according to reports.

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The reports further said the frozen amount will be reassessed by the Department of Telecommunications (DoT) at a later stage. However, the relief does not apply to AGR liabilities related to FY18 and FY19.

These dues will not have to be paid immediately and will instead be repaid over a long period of 10 years, starting from the financial year 2031–32 (FY32) and continuing till FY41.

The frozen AGR dues will be reviewed by the telecom department based on Deduction Verification Guidelines and audit reports giving Vodafone Idea some flexibility in managing its long-term financial burden.

Recently, the Supreme Court had also allowed the government to undertake a comprehensive reassessment and reconciliation of all dues of the financially stressed telecom company, including interest and penalties, up to FY17.

Earlier in September, the company had sought a waiver of penalty and interest on an AGR demand of Rs 9,450 crore raised by the DoT, arguing that a large portion of the amount related to the pre FY17 period that had already been settled by the apex court in 2020.

The government became the largest shareholder in Vodafone Idea in March this year after converting dues worth Rs 36,950 crore into equity, taking its stake to nearly 49 per cent.

In 2023, the Centre had acquired a 33 per cent stake in the company in lieu of statutory dues exceeding Rs 16,000 crore.