Telecom Diary: Resurrection of Vodafone Idea, tariff hikes to be a game changer post relief package

The struggling telecom player Vodafone Idea (Vi) got a breather this week as the government announced a relief package for the telecom sector which includes a moratorium on adjusted gross revenues (AGR) payments.

Vi, though, may have received the first survival dose by way of a relief package but its woes are far from over. The fate is still hanging by a thread. Unless, there is a tariff revision upwards, it will always be a difficult road to tread especially for Vi. Though, Airtel and Reliance Jio will benefit from tariff hikes too.

For Vi, an immediate fund infusion for network expansion is also critical. The company has been trying to raise Rs 25,000 crore for a year. Without substantial expansion, it won’t be able to retain its users which have been leaving the sinking ship and shifting to competitors.