Bharti Airtel chairman Sunil Mittal seeks govt help for telecom sector

Indian telecom is not “out of the woods”, despite proving itself indispensable during the nationwide lockdown imposed to contain the spread of the coronavirus, said Bharti Airtel Chairman Sunil Bharti Mittal on Tuesday, urging the government to “close long-standing legal disputes”.

“The company…is of the view that the telecom price wars changed the landscape of the industry we have known and operated in to date and the adjusted gross revenue (AGR) dues have caused significant distress in business sustainability for industry players,” he said.

Mittal said the government should look at rationalising levies on the sector and “close long-standing legal disputes that are a big drag on the performance of operators”.

On July 20, the Supreme Court rejected telecom companies’ demand to re-assess their dues linked to adjusted gross revenue (AGR) and said it would decide later a government plea to give the firms a 20-year staggered payment timeline. The court upheld the amount to be paid by Bharti Airtel at Rs 25,976 crore and by Vodafone Idea at Rs 50,399 crore, factoring in the companies’ payments of Rs 18,004 crore and Rs 7,854 crore.

“While it’s clear that the worst may be behind for India’s telecom industry, we are yet to emerge from the woods. India still has some of the lowest data tariffs globally and the industry is barely able to cover the cost of capital. It requires much more support to repair the deep damage to its finances and make it viable for telecom operators to invest in future technologies,” Mittal said in a message to Airtel shareholders.

Mittal said that despite the recent tariff increase, “we are still way below the levels to make the industry viable. Given the commendable job it (telecom industry) has done to keep India connected, I hope the government will look into the urgent needs of the operators”.

The company is gearing for up the next generation 5G services, and to be future ready, it is looking to upgrade existing 4G base stations with 5G capabilities, Mittal said. The rising demand for high speed data has escalated the need for 5G services in one of the world’s largest telecom markets. The proposed investments in the current networks will deliver best-in-class connectivity to Airtel consumers, laying a strong foundation for 5G services in the near future, he added.  Mittal said Airtel was conceptualising 5G trials in association with telecom gearmakers and app developers.