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Is Vodafone Idea too big to fail? Why its collapse will hurt a billion-plus Indians

A large-scale migration of Vodafone Idea’s 300 million subscribers to Jio and Airtel will severely stretch their infrastructure, with a likely slide in service quality and standards. A duopoly can mean a spike in tariffs and slow down the spread of telecom services to rural India. Then, a possible bankruptcy is bad news for India’s ailing financial sector.
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26 Feb 2020 11 Mins Read 13 comments
Concept by Muhabit ul haq and Mohammad Arshad Getty Images
Concept by Muhabit ul haq and Mohammad Arshad
Call it India’s penchant for self-destruction. The wheels are coming off the country’s egalitarian telecom revolution, an offspring of the 1991 economic reforms. It’ll jolt the lives of billion-plus Indians if the government doesn’t find a way out of the mess. Vodafone Idea is tottering, buried under a mountain of AGR dues and debt. Its collapse will send
It is important to explore all options carefully so that the telecom mess doesn’t snowball into one faced by the NBFCs last year. If this happens, India runs a huge reputational risk, and getting foreign direct investment (not only in telecom) will become a challenge. ( Graphics by Mohammad Arshad and Sadhana Saxena; research support by Rochelle Britto)
Call it India’s penchant for self-destruction. The wheels are coming off the country’s egalitarian telecom revolution, an offspring of the 1991 economic reforms. It’ll jolt the lives of billion-plus Indians if the government doesn’t find a way out of the mess. Vodafone Idea is tottering, buried under a mountain of AGR dues and debt. Its collapse will send It is important to explore all options carefully so that the telecom mess doesn’t snowball into one faced by the NBFCs last year. If this happens, India runs a huge reputational risk, and getting foreign direct investment (not only in telecom) will become a challenge. ( Graphics by Mohammad Arshad and Sadhana Saxena; research support by Rochelle Britto)

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