Relief To Telecos
- The Union Cabinet, last week, approved a crucial relief package for the cash-strapped telecom firms.
- Package includes a four-year moratorium on payment of statutory dues by telecom companies as well as allowing 100% FDI through the automatic route.
- The wide set of measures proposed entail reforms for the ailing sector by way of granting moratorium on unpaid dues, redefining Adjusted Gross Revenue (AGR) prospectively and cutting in Spectrum Usage Charges.
- It provided much needed relaxation to telecom companies Vodafone Idea, Reliance Jio and Bharti Airtel.
- These are expected to protect and generate employment opportunities, promote healthy competition, protect interests of consumers, infuse liquidity, encourage investment and reduce regulatory burden on Telecom Service Providers (TSPs).
- A moratorium on AGR-related dues will offer space to the cash-strapped firm to improve its business and clear dues over a longer period.
- The definition of AGR has been changed to exclude non-telecom revenue. All non-telecom revenue will be removed from AGR.
Source : Business Standard