Telecom Reforms: How Realistic Will the Impact Be on Vodafone Idea?

Are the reforms enough to keep Vodafone Idea afloat for the next few years? Tune in!

In a significant move on Wednesday, 15 September, the Centre 'top-upped' the telcos by a providing a four-year moratorium on their due payments as part of its latests reforms.

The move comes as a big relief to the financially starved industry, especially to Vodafone Idea and Bharti Airtel – two of the hardest hit telcos.

In short, these reforms provide the telcos four more years to pay their adjusted gross revenue (AGR) and spectrum dues and will kick in from 1 October.

While the telcos will have to pay interest on the four year deferral of payments, they have the option to convert the due amount into equity at the end of four years.

But even though many experts have welcomed the reforms, the question which still looms in the air is if this is enough to help Vodafone Idea survive, which just six weeks ago was on the brink of collapse due to the burden of its exposure to the market.

To understand the reforms introduced and how realistic their impact will be on telcos like Vodafone Idea, we spoke to former Bharti Airtel CEO Sanjay Kapoor.