Cabinet refuses proposal for telecom relief measures
- ByStartupStory | September 9, 2021
India’s federal cabinet has not taken up the proposals for providing financial relief to the country’s debt-burdened telecom sector.
The cabinet was anticipated to take a decision on a so-called relief package for the telecoms industry, which would have helped all wireless carriers but especially the castled Vodafone Idea.
No reason for the refusal of the proposal was discussed.
Shares in Vodafone Idea went down to 1.2% while Bharti Airtel fell 0.2% at 0751 GMT when the news that the cabinet was holding off on measures to support the industry was announced. Both stocks had rallied on Tuesday in the hopes of government help.
The sector was also hit by a Supreme Court ruling last year which forces carriers Bharti Airtel and Vodafone Idea to give in to a government demand for dues which they have long contested.
Vodafone Idea has paid the government 78.54 billion rupees dues, but regulatory filings still show that it owes roughly 500 billion.
Bharti Airtel claimed that it paid dues estimated at 180 billion rupees, but government figures show it owes a further 259.76 billion.
Vodafone, which has a net debt of 1.91 trillion rupees, has earlier raised serious concerns about its ability to stay out of debt without help from the government and its billionaire non-executive chairman had stepped down last month.
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