Vodafone Idea’s AGR relief explained: How much it pays, and when

Debt-laden telecom operator Vodafone Idea Limited on Friday said it has received relief from the Department of Telecommunications (DoT) on its adjusted gross revenue (AGR) liabilities.

The confirmation follows source-based reports from December 31 that had indicated Cabinet approval, though no official government announcement was made at the time.

What relief has Vodafone Idea received?

In a regulatory filing, the company said the DoT has frozen its AGR dues, including principal, interest, penalty and interest on penalty, for the period from 2006-07 to 2018-19 as on December 31, 2025.

As per the communication received from the DoT, Vodafone Idea will pay a maximum of ₹124 crore annually for six years from March 2026 to March 2031. This will be followed by payments of ₹100 crore annually for four years from March 2032 to March 2035.

The remaining AGR dues will be paid in equal annual instalments over six years from March 2036 to March 2041.

The filing further said a committee will be constituted by the DoT to reassess the company’s AGR dues, and its decision will be final.

The reassessed amount will also be repaid in equal annual instalments between March 2036 and March 2041.

However, AGR dues relating to FY2018 and FY2019, which were finalised under a 2020 order of the Supreme Court of India, will remain unchanged and will be paid between FY2026 and FY2031.

Why is this relief significant?

The relief is expected to ease near-term repayment pressure on the telecom operator, which has been grappling with a heavy debt burden and funding constraints.

Vodafone Idea had earlier warned that it could face insolvency by FY26 without further government support.

Earlier this year, then Vi CEO Akshaya Moondra had, in a letter to the Department of Telecommunications, warned that the company could face insolvency by FY26 without government relief.

“Without GoI’s timely support on AGR, VIL will not be able to operate beyond FY26,” the letter stated, adding that the lack of bank funding and moratorium on spectrum payments would freeze capex, shrink the subscriber base, erode EBITDA, and render the government’s equity stake worthless.

The relief comes after the Supreme Court allowed the government to reconsider additional AGR demands up to 2016-17 and to comprehensively reassess AGR dues, including interest and penalties.

Vodafone Idea’s total debt stood at ₹2.02 lakh crore at the end of the second quarter.

Vodafone Idea has shown signs of financial improvement, narrowing its consolidated net loss year-on-year to ₹5,524 crore in the second quarter ended September 2025, helped by lower finance costs and higher average revenue per user following tariff hikes.

Finance costs fell about 27% year-on-year to ₹4,784.4 crore during the quarter, while debt from banks declined to ₹1,542 crore from ₹3,250 crore a year earlier.