'Conversion of Airtel statutory liabilities into equity needs scrutiny'

Bharti Airtel's about Rs 41,000-crore of adjusted gross revenue (AGR) dues will not be converted into equity automatically as the telco's application for such conversion will go through a scrutiny at the Department of Telecom (DoT), an official source said on Friday.

Bharti Airtel has sought conversion of its AGR dues of around Rs 41,000 crore, including interest liability, into equity in line with the relief given to debt-ridden Vodafone Idea by the government.

"The application does not mean that it will be processed automatically. It needs to be evaluated and scrutinised before any final decision is made," the source said.

An e-mail seeking comments from Bharti Airtel elicited no reply.

The government has given relief to Vodafone Idea by converting its dues worth Rs 53,000 crore into equity ownership in the company.

The government has recently increased its stake in Vi to 48.99 per cent from 22.6 per cent by converting dues worth Rs 36,950 crore.

Earlier, the government had converted VIL's debt of about Rs 16,130 crore, comprising interest arising from deferment of AGR and spectrum instalments, into equity in February 2023.

While the telecom reforms policy of 2021 allows interest liability related to spectrum and AGR dues to be paid through equity, the government has now allowed telecom operators to opt for conversion of even principle amount for spectrum auction held before 2021 and AGR dues.

Bharti Airtel has cleared all its dues for the spectrum that it purchased before 2021 auction.

The company has purchased spectrum worth Rs 68,598 crore in auctions that were held in 2021, 2022 and 2024, and the dues are eligible for conversion into equity.