Distress in the Indian Telecom Industry
After the telcos adjusted to the new market expectations that Reliance Jio had created, they were served a notice by the court. All the telcos in India were asked to clear their Adjusted Gross Revenue (AGR) dues. This further added to the distress of the telcos. Jio didn’t face a lot of problems due to the court order since it is fairly new and its AGR dues are comparatively nothing like that of other telcos. Airtel at the same time has been asked to pay $3 billion to clear its dues. Vodafone Idea isn’t having the best time in the market as well.
Tariff Hike to Help Telecom Industry
In the near future, it is expected that there will be a tariff hike introduced by all the telcos in the Indian telecom industry. The revenues for the telcos from their mobile users are going to grow as such that it may doubly by FY25. It is expected to grow even after that. A deep analysis of around 25 markets suggests that the Average Revenue per Indian user (ARPUs) in India will become grow to USD 38 billion. Bharti Airtel is the telco which is expected to benefit the most from the tariff hike. At present, the mobile revenues-to-GDP for India is one of the lowest standings at 0.7% when compared with around 25 countries. But after the tariff hike phase comes to the India telecom industry, it will sustain. Not only that, but it will also even grow by 3% to 5% every year for the foreseeable future. It is the same trend as of the Fast Moving Consumer Goods (FMCG) industry.
