Telcos Given Deadline To Respond To The Reforms

The telecom giants Vi, Bharti Airtel and Reliance Jio have been given a deadline of October 29 by the Department of Telecom to respond if they want to opt for the four-year moratorium, offered in the latest telecom relaxations. An additional period of 90 days has also been given to respond on if the companies would want to convert their interest due into equity or not.

The issue covered in the letter is one of the most important issues in the latest round of reforms. Vi was struggling the most due to the earlier denial of the government to provide a moratorium period and vast due interest payments.

If the companies want to opt for the four-year moratorium and converting their interest due into equity, they will have to submit their audit financial statements. Most of the companies are most likely to opt for the moratorium period as well as the equity option.

The four-year moratorium was offered on the Adjusted Gross Revenue (AGR) and spectrum payments. It has considerably reduced the burden of cash flow in the companies. Out of all the companies, Vi is the worst hit. Various senior officials, including Kumar Mangalam Birla, have stepped down from their posts in 2021. The reforms are expected to provide some relief to the ailing telcos.