Rising Bharat Summit: Prospects for Vodafone Idea promising after AGR dues conversion, SC verdict, says Scindia

Jyotoraditya Scindia said that other telecom operators seeking relief must approach courts

• Govt owns 33% of Vodafone Idea, not involved in management
• Vodafone Idea's AGR dues frozen until Dec 2025, recalculation underway
• Relief to Vodafone Idea based on Supreme Court order, not for all

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Union minister of communications Jyotiraditya Scindia said while addressing the Rising Bharat Summit that while the management of the stressed telecom operator Vodafone Idea will have to chart its own path of growth, the prospects for the firm are looking up, after the government's conversion of part of the adjusted gross revenue (AGR) to equity, and executing the Supreme Court order regarding relief to the operator in AGR calculation.

"...We have followed the Supreme Court verdict and executed on that, and things look promising as far as Vodafone Idea is concerned. But we are an equity holder, and that does not mean that we are in management...We do not believe in increasing the stake beyond 49 percent. It is on the management of Vodafone Idea to chart their course going forward," Scindia said at Newxs18 Rising Bharat Summit.

The government has frozen Vodafone Idea's AGR dues at Rs 87,695 crore till December 31, 2025, and has also initiated a recalculation exercise of the company's AGR dues for a 12 year-period between 2006-07 and 2018-19, after an order from the Supreme Court.

Regarding relief to other operators, as sought by players such as Bharti Airtel, Scindia said that the relief granted to Vodafone Idea was by the Supreme Court, and other operators seeking similar relief have to follow a similar route.

As for tariff hikes, Scindia highlighted the "inelastic" nature of the market, but also noted that the key to growth in India is through high volumes.

"India has shown the world how you can permeate technology right down to the grassroot level, when you have 1.2 billion telecom subscribers, when your broadband subscribers go from 60 million to a billion today. That kind of growth, a CAGR of 30-40 percent, results in a steep decline in prices for customers...Data in India costs less than Rs 8 for 1 GB, which is less than 10 cents. The world average $2.49," Scindia said.