Government Approves Relief Package for Vodafone Idea's AGR Dues

On December 31, 2025, the Indian government approved a relief package for Vodafone Idea, freezing its AGR dues of ₹87,695 crores until 2025. This decision aims to support the struggling telecom company and maintain competition in the sector. However, the market reacted negatively initially, with shares dropping significantly. Following news of a capital infusion, shares rebounded, highlighting the ongoing challenges and strategies needed for Vodafone Idea's future growth amidst fierce competition from major players like Jio and Airtel.

By Narendra Chaudhary Jan 1, 2026, 11:26 IST

Significant Relief for Vodafone Idea

New Delhi: On the last day of 2025, the central government extended a significant relief package to Vodafone Idea, a telecom company facing financial difficulties. The Union Cabinet has approved a relief plan concerning the company's Adjusted Gross Revenue (AGR) dues. Under this package, Vodafone Idea's outstanding AGR amounting to ₹87,695 crores will be frozen until December 31, 2025. The repayment of this amount will commence between FY 2031-32 and FY 2040-41, with no interest accruing during this period.

Key Highlights of the Relief Package:

Outstanding Amount Frozen: Total AGR liability of ₹87,695 crores remains unchanged.

Moratorium: A five-year relief period, with payments starting from FY 2031-32.

Reassessment: The Department of Telecommunications (DoT) will review the dues based on audit reports, potentially reducing interest and penalties.

Outstanding for FY17-18 and FY18-19: No changes; repayment will occur from FY26 to FY31.

This decision was made considering public interest, maintaining competition in the telecom sector, and protecting the interests of 200 million consumers.

However, the announcement of this relief package had an immediate negative impact on the market. On December 31, shares of Vodafone Idea plummeted, dropping as much as 18% during the day and closing down nearly 12% at ₹10.76. The decline was attributed to investors' expectations for a complete waiver of interest and penalties, which was not included in the package, only a postponement and potential reassessment.

On January 1, 2026, as the market opened, shares rebounded. News of a ₹5,836 crore capital infusion from promoters led to a rise of 4-5%, with shares reaching levels of ₹11.20-₹11.24. This infusion is expected to strengthen the company's balance sheet and facilitate future investments.

Experts believe this relief will provide Vodafone Idea with a breathing space, but long-term strategies for fundraising, 5G rollout, and expanding the subscriber base are crucial. The competition remains fierce in the telecom sector, particularly against the dominance of Jio and Airtel.