Significant Reforms In The Indian Telecom Sector

The Union Cabinet on September 15, 2021, approved major structural as well as procedural reforms in the telecom sector with the aim to protect and generate employment opportunities, promote healthy competition, protect interests of the consumers, infuse liquidity, encourage investment and reduce the regulatory burden on Telecom Service Providers ("TSPs").¹ This move of the government coupled with the Supreme Court's recent judgement in the case of Union of India vs. Association of Unified Telecom Service Providers of India² on September 1, 2021, comes as a respite to India's financially distressed telecom sector.

To understand the judgement, it is pertinent to discuss the background of this case. The dispute stems from the Adjusted Gross Revenue ("AGR") dues owed by the TSPs to the government in relation to their revenue sharing obligations under license agreements with the government. The definition of AGR in these license agreements has been a contentious issue