CII, FICCI join cause to seek relief for telcos

Bid to counter billionaire Mukesh Ambani-run Jio narrative

New Delhi, December 1

Rival industry associations— CII and FICCI — have closed ranks and written to Finance Minister Nirmala Sitharaman seeking relief for telecom companies that have been ordered by the Supreme Court to pay Rs 1.47 lakh crore in past statutory dues, in an apparent attempt to counter billionaire Mukesh Ambani-run Jio’s narrative on the issue.

While Jio has been strongly opposing a bailout of telecom companies at taxpayers’ expense, saying they had “sufficient” financial capacity to pay dues, CII and FII presidents have in separate letters asked the Finance Minister to address the “precarious” financial position of telcos saddled with a debt of Rs 7 lakh crore and ensure robust competition for vibrancy in the sector.

CII president Vikram Kirloskar in November 19 letter sought revisiting the current revenue-sharing business model where the government is paid a pre-decided share of the income generated from using scarce natural resource, and replace it with a “competitive and transparent” model.

FICCI president Sandip Somany wrote to Sitharaman on the issue on November 27. “The precarious financial health of key players in this sector and their massive debt burden (estimated to be Rs 7 lakh crore), threaten not only their individual existence, but also the much-needed vibrancy in this sector of national importance,” Kirloskar wrote.

The Supreme Court on October 24 upheld the government position that non-telecom revenue should be included in calculating AGR, a percentage of which is paid to the exchequer as statutory dues. Telcos such as Bharti Airtel and Vodafone Idea were asked to pay Rs 1.47 lakh crore in past dues within three months.

“In this context, the CII urges the government to consider addressing the situation in a manner which continues the robust competition in the industry and ensures further investments in infrastructure for new technologies,” the November 19 letter read. PTI