The central government, already Vodafone Idea Limited’s (Vi) largest shareholder through earlier debt-to-equity conversion, is reportedly evaluating multiple options to provide the financially stressed telecom operator relief on its remaining regulatory dues of Rs 840 billion. The move comes amid concerns that Vi may not survive without urgent intervention.
Among the proposals under consideration is extending the repayment tenure for Vi’s adjusted gross revenue (AGR) dues from the current six years to 20 years. Additionally, the government may replace the current compound interest regime with a simple interest model to further ease Vi’s financial burden. If implemented, this could substantially lower the telco’s annual outgo.
Another option being weighed is to allow Vi to make nominal payments, estimated at Rs 1-1.5 billion annually, as token instalments until a final decision is reached on the overall AGR liability structure. This interim arrangement would provide temporary relief while larger structural changes are deliberated.
Vi currently owes Rs 834 billion in AGR dues as of March 2025, with annual instalments beginning March 2026 and continuing until financial year 2030-31 (FY31). However, the company is required to pay Rs 180.64 billion by the end of the current financial year. With a reported cash and bank balance of Rs 99.3 billion at the end of March, the government is concerned that the telco lacks the liquidity to meet its obligations without support, raising the spectre of operational failure.
