Lok Sabha Question No. 755 (UNSTARRED), answered on 2026-02-04
Subject: Financial Stress faced by Telecom Operators
Ministry: COMMUNICATIONS
Asked by: Dr. Amar Singh

## GOVERNMENT OF INDIA MINISTRY OF COMMUNICATIONS DEPARTMENT OF TELECOMMUNICATIONS

## LOK SABHA UNSTARRED QUESTION NO. 755 TO BE ANSWERED ON 4 TH  FEBRUARY, 2026

## FINANCIAL STRESS FACED BY TELECOM OPERATORS

## 755. DR. AMAR SINGH:

Will the Minister of COMMUNICATIONS be pleased to state:

- (a) whether  the  Government  has  considered  the  financial  stress  faced  by  telecom  operators arising from adjusted gross revenue liabilities and its implications for sectoral stability;
- (b) if  so,  the  details  of  policy  considerations  undertaken  by  the  Government  while  balancing consumer interest, public revenue and competitive sustainability; and
- (c) the  long-term  regulatory  approach  proposed  by  the  Government  to  prevent  recurrence  of financial distress in the telecommunications sector?

## ANSWER

## MINISTER OF STATE FOR COMMUNICATIONS AND RURAL DEVELOPMENT (DR. PEMMASANI CHANDRA SEKHAR)

(a) to (c) To  address  the  issue  of  financial  stress  in  the  telecom  sector  the  Government  has approved various structural and process reforms in the telecom sector over the last five years. The key reforms are as below:

- i. Rationalization of Definition of Adjusted Gross Revenue (AGR).
- ii. Rationalization  of  Interest  rates  and  removal  of  Penalties  for  delayed  payments  of License Fee (LF)/Spectrum Usage Charges (SUC).
- iii. Rationalization of Bank Guarantee requirements under the license agreement.
- iv. Removal of levy of Spectrum Usage Charges on the spectrum acquired in auctions held after September 2021.
- v. Provision  for  payment  of  Spectrum  auction  bids  in  20 equal  annual  instalments  for auctions held after September 2021.
- vi. Requirement of securitizing annual deferred spectrum instalment with a Financial Bank Guarantee has been done away with in Spectrum auctions held after September 2021, while for auctions conducted prior to 2021, the same requirement has been rationalised, if certain conditions are met.
- vii. Surrender of spectrum will be permitted after 10 years for spectrum acquired in auctions held after September 2021.
- viii. The requirement of payment of additional 0.5% of AGR as SUC on sharing of spectrum has been removed.
- ix. Moratorium of up to four years in annual payments of dues arising out of the AGR judgement of the Hon'ble Supreme Court and spectrum purchased in past auctions held before  2021,  applicable  to  access  service  licenses  that  are  not  under  insolvency  / liquidation  proceedings.  The  moratorium  is  revenue  neutral  and  Net  Present  Value (NPV) of the deferred payment is protected. Option to the Telecom Service Providers

(TSPs) to pay the interest amount arising due to the said deferment of payment by way of equity was also given. Further, at the option of the Government and based on the prevailing situation, the outstanding amount of post-moratorium installments may be converted into equity.

- x. To  encourage  investment,  100%  Foreign  Direct  Investment  (FDI)  under  automatic route permitted in Telecom Sector with applicable safeguards.

Further, in pursuance of the orders of the Hon'ble Supreme Court in Writ Petition (Civil) No. 882/2025  and  the  representation  submitted  by  Vodafone  Idea  Limited  (VIL),  restructuring  and reassessment of AGR dues of VIL have been approved.

The sectoral measures were introduced to promote healthy competition, protect interests of consumers, infuse liquidity, encourage investment and reduce regulatory burden on Telecom Service Providers.  They  were  formulated  after  considering  representations  from  industry  associations, financial  institutions,  and  inter-ministerial  consultations  involving  relevant  Ministries,  wherever applicable. It may be noted that the telecom sector's  gross  revenue has grown significantly from ₹2.73 lakh crore in FY 2020-21 to ₹3.79 lakh crore in FY 2024-25, reflecting a Compound Annual Growth Rate (CAGR) of approximately 8.5%, to which these measures have been a contributing factor.

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