Even as the bleeding telecom sector continues to await the Centre’s assistance, the Union Cabinet led by Prime Minister Narendra Modi on Wednesday failed to announce any comprehensive financial relief plan to rescue the cash-strapped telecom majors.
The sector was hoping for some announcement from the Centre as the Union cabinet was likely to take up the issue during Wednesday’s crucial meeting. According to top industry sources, the cabinet was widely expected to take a decision on a so-called relief package for the telecoms industry, which would have helped all wireless carriers but especially the embattled Vodafone Idea.
Among the worst-hit telecom operator Vodafone Idea, which many believe is running towards a dead end due to rising debt and operational costs, remained hopeful of some government action soon to rescue the sagging spirits.
Marred by rising competition from Reliance Jio in recent times that has led to a major drop in revenues the two out of three operators in the country has also been saddled with huge government debt following a Supreme Court ruling last year which forces carriers Bharti Airtel and Vodafone Idea to pay the government huge sums running into many billion dollars.
Vodafone Idea has so far paid the government Rs 78.54 billion ($1.07 billion) in telecoms dues, regulatory filings show, but still owes roughly Rs 500 billion.
Bharti Airtel has said its paid dues are estimated at Rs 180 billion, but government figures show it owes a further 259.76 billion. Vodafone, which has a net debt of Rs 1.91 trillion, has previously raised serious concerns about its ability to stay afloat without government help and its billionaire non-executive chairman stepped down last month.