Vi may get 4-5 years of AGR dues moratorium; dues could be halved

Core Viewpoint - The government is expected to provide Vodafone Idea (Vi) with an interest-free moratorium on over ₹83,000 crore of pending statutory dues, offering immediate relief to the financially struggling telecom operator [12]. Group 1: Government Relief Package - The relief package will allow Vi to pay arrears in six instalments after the moratorium ends, with the total amount likely reduced to nearly half following a reassessment of liabilities [1][12]. - A committee led by a secretary-level official will be formed to evaluate the final amount to be paid, with an announcement expected in the coming weeks after Cabinet approval [2][12]. - Under the new package, Vi's outstanding amount will be sealed, and no further interest will accrue on these dues [7][12]. Group 2: Financial Context - Vi is required to pay over ₹18,000 crore as the first instalment next March after the end of a previous moratorium, which was not interest-free, leading to increasing arrears [12]. - The company and its competitor Bharti Airtel incur 29-30% compound interest annually on outstanding amounts due to a 2019 Supreme Court ruling mandating statutory payments based on adjusted gross revenue [6][12]. Group 3: Investment Opportunities - Once the relief is secured, Vi may be able to raise fresh capital, including a planned ₹25,000 crore equity issue, which could dilute the government's stake and provide additional financial flexibility [9][12]. - New York-based private equity firm Tillman Global Holdings is reportedly negotiating a $4-6 billion investment in Vi, contingent on the company receiving relief [10][12].