Despite slump, Airtel to go ahead with Rs 20K-cr investment plan

Mittal said he discussed a plethora of issues with Commerce and Industry Minister Piyush Goyal and sought the government's support for faster clearances to streamline the group’s investment plans.

Despite the slowdown, Sunil Bharti Mittal, chairman of Bharti Airtel, said the company was continuing with its annual target of investing around Rs 20,000 crore in the business.

“We typically invest Rs 20,000 crore in telecom every year, and we will continue to do so,” Mittal said after his two-hour-long meeting with Commerce and Industry Minister Piyush Goyal.

Mittal said he discussed a plethora of issues with Goyal and sought the government's support for faster clearances to streamline the group’s investment plans.

“We discussed all group matters, mainly the infrastructure sector - telecom, tower business, solar, and real estate,” Mittal said.

Commenting on the one-year extension given by the Telecom Regulatory Authority of India (Trai) to the IUC (interconnect usage charge) regime, Mittal said he was glad that the authority “heeded to the request of the industry”.

On Tuesday, the Trai deferred, by one year, the scrapping of the charge paid by mobile phone users for calls made to rival networks.

It also initiated talks to prescribe minimum or floor price for call and data, effectively ending the free call regime.

The telecom authority said operators would continue to pay 6 paise per minute for every outgoing call made to their competitors' network till December 31, 2020.

These charges are proposed to become zero from January 1, 2021.

Airtel and Vodafone Idea had been pitching with the government for fixing of a floor rate for calls and data.

On Tuesday, the Trai also released a consultation paper to fix minimum floor rates for mobile phone calls and data, a move that will effectively end the regime of free calling and dirt cheap data.

“They need to bring some sense in the industry… We are happy with whatever they do,” Mittal said.

At present, telecom call and data rates are not regulated.

However, private telecom operators unanimously approached Trai to fix minimum price for mobile internet rates.

Mittal said he made a request, on behalf of the telecom industry, for Rs 37,000 crore Goods and Services Tax (GST) refund.

Airtel is also hopeful of some relief from the Supreme Court on the AGR (Adjusted Gross Revenue) issue.

The SC, on October 24, had allowed the central government to recover Rs 92,641 crore AGR from operators including Airtel, Vodafone Idea and Reliance Jio.

The total AGR demand (including penalties and interest) from telcos adds up to an estimated Rs 1.4 trillion.

The apex court ordered the telcos to pay the past statutory dues within three months or by the end of January 2020.

The companies are seeking waiver of interest and penalties on the dues.

They have also made an appeal for staggered payments.

Meanwhile, the impending spectrum auctions didn’t make it to the list of issues flagged by Mittal.

When asked about the auctions, he said that it “looks” unlikely this fiscal, as the health of the industry needs to improve.

The telecom industry, which has a debt of around Rs 4 trillion, has sought the government's intervention in tackling the stress.

The Union Cabinet on November 20 had announced a Rs 42,000-crore package in terms of a two-year moratorium spectrum payments to debt-laden telecom companies.

On his discussions on other businesses with Goyal, Mittal said, “As a group we need to do a lot more investments, we need a little bit of encouragement in terms of faster clearances from the government.”