Debt-laden telecom operator Vodafone Idea (Vi) has received significant relief after the Union Cabinet approved a five-year moratorium on its adjusted gross revenue (AGR) dues, freezing payments worth ₹87,695 crore, according to sources cited by PTI.
Under the approved framework, Vodafone Idea will not be required to make any AGR-related payments during the moratorium period. The frozen dues will be repaid over a 10-year window from FY32 to FY41, with no interest accruing during the moratorium, providing critical financial breathing room for the company.
Once the moratorium concludes, the outstanding AGR arrears will be settled in six to ten instalments, easing the immediate strain on Vodafone Idea’s balance sheet as it continues to grapple with high debt and operational challenges.
Despite the relief, Vodafone Idea’s stock reacted sharply to the news. Shares of the company fell 15.01%, or ₹1.81, to ₹10.25 by 2:45 PM on Wednesday, reflecting investor caution amid lingering concerns over the telco’s long-term financial sustainability.
According to government sources, the Cabinet’s decision is aimed at protecting the Centre’s 49% stake in Vodafone Idea, ensuring an orderly recovery of statutory dues, and maintaining stability in India’s telecom sector. The move is also intended to safeguard competition in the market and protect the interests of nearly 20 crore Vodafone Idea subscribers across the country.
However, the relief does not extend to all AGR liabilities. Dues for FY18 and FY19, which were finalised under the Supreme Court’s 2020 ruling, will continue to be payable as scheduled. Vodafone Idea will be required to clear these payments between FY26 and FY31, with no change to the existing timeline, sources added.
The Cabinet’s decision marks another step in the government’s broader efforts to stabilise the telecom industry, which has seen consolidation and financial stress over the past decade, while ensuring the survival of a three-player private market structure.
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