Keeping Vodafone-Idea In System Is Most Critical Thing: COAI DG

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The telecom sector, which is under deep is in under deep financial crisis, is eyeing government support, especially Vodafone-Idea. The merged entity is trying its best and looking for ways to sustain in the industry; however, the ball is in the court of the government as financial reforms are in the hands of the DoT.

 
Keeping Vodafone-Idea In System Is Most Critical Thing: COAI DG

Notably, the Department of Telecommunication is reportedly working on measures to improve the health of the sector; however, no one knows when the ministry will announce the same. Meanwhile, we got a chance to interact with COAI director-general SP Kochhar regarding the current issues in the sector.

 

In an interaction, he said, that "The telecom industry is facing problem in the financial aspect and all three private telecom operators are looking for government support."

He exclusively informed Gizbot that the industry body is discussing this matter with the government daily and considering the essentiality of the upcoming network, these issues should be addressed.

COAI Letter To Telecom Secretary

The Cellular Operators Association of India (COAI) has also written a letter to the telecom secretary and pointed out that the industry is heavily taxed. The industry body asserted that financial reforms are urgently required for proper growth.

"We can only suggest some measures and floor pricing is one of them; however, we want the government to reduce levies, revisit bank guarantees, and the most important to look at spectrum prices," he added further. Besides, the definition of adjusted gross revenue (AGR) needs to revise. It is an old definition, which needs to be revisited.

Vodafone-Idea Bankruptcy

"I don't think that any company will take such a decision till the time they exhaust all revenues and it is very premature to say, " Kochhar replied when asked about the Vodafone-Idea bankruptcy.

It is important to note that the telecom operator has recently made few changes in its postpaid plans and is expected to make a similar change in the prepaid segment; however, this might not only help the company in the long run as the situation requires drastic actions.

Furthermore, he said currently, the most critical thing is keeping Vodafone-Idea in the system. Increasing marginal prices is not going to help them as it requires much more introspection by industry and the government. This may increase their revenue to some extent, but it will not help them to get out of the crisis.

For the unaware, that the survival of Vodafone-Idea depends on the financial reforms, the telecom operator is not in a mood of filing bankruptcy as this move might indicate that it is the company's fault.

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