Business

Airtel’s woes in Nigeria

Indian telecom giant Airtel is unable to get rid of its woes neither in India nor anywhere in the world. Once the largest player in the Indian telecom market has now lost its position to the newly formed Vodafone Idea. In terms of growing subscribers in India, it is being rattled by the newcomer, Jio. The only relief that they have in India is their long history and reliable past service record, which allows the users to keep using their services.

Talking of the global market, it has been challenged recently. There is a lack of uniqueness in terms of call rates and international roaming charges. This makes the newer companies much alluring as compared to Airtel. Reliance Jio introduced their international roaming packs and it aims to surpass the existing players.

Nigeria is one of the most developed African nations. They are high on technological advancements and their population is rapidly moving with the telecom wave. Airtel, being one of the largest telecom service providers in the world, went out to pursue its global dreams in this country. However, in a recent revelation by the company, it is found that the Nigerian government has ordered the Tax authorities to close the premises and shut Airtel’s business in the country. It should be noted that Airtel held 51% in Nigeria making it the leader in the telecom industry. According to the company’s employees, the tax authorities sealed the company’s premises and ousted the employees.

The Nigerian government has accused the company of not paying taxes worth over $107 million (764 crore rupees). This also includes a fine of around 122 crore rupees. This outrage is not just against the Indian company as reports suggest similar actions taken against the popular French telecom player, Orange against similar accusations.

Airtel has around 4.4 million subscribers in the country and they hope for a quick resolution to this unfavourable situation. The move by the Nigerian government has put in jeopardy, the future of all of its Nigerian employees.

In other parts of Africa too, Airtel is facing difficulties in smoothly running the business due to the decision-making processes and role of the shareholders in the process. For instance, the Tanzanian arm of the company also faced backlash regarding the planned divestment of its shares. The current situation of its home market is unfavourable and is looking to be even worse in the coming times. It is expected that around 60 million duplicate subscribers (people who use more than one sim cards) will be leaving the Indian telecom market in less than 6 months. Most of these customers will be from Airtel and the company has to look towards securing its home territory first. Only then can it look for acquiring markets elsewhere.

– Soumya De

Comment here