Vodafone Group Plc is mulling over a plan to make a multi-billion tax provision to cover the legal risks, the mobile phone operator's chief financial officer Andy Halford has revealed.

Vodafone has been resisting setting aside money for a $2.2 billion tax bill in India. The huge tax bill stemmed from the company's 2007 acquisition of Hutchison Whampoa's operations in India.

The world's second-biggest mobile phone operator initially refused to pay the taxes and opted for legal battle. In response, the government of India made an amendment in the law to retrospectively tax cross-border transactions that dated back to April 1, 1962; making the mobile phone company potentially liable for making the payment.

In a recent interview, Halford said, "The situation has changed and we are looking at it."

He added that Vodafone's test over whether to make a provision was now being applied in a different way against the recently introduced, retrospective, legislation.

Newbury, England-headquartered Vodafone is relying on emerging markets like India as consumers in debt-stricken Europe are cutting their spending on mobile phones. European market accounts for around 70 per cent of Vodafone's total revenue.

Stock in Vodafone slipped nearly 1.3 per cent to 173.50 pence a share in London. By index points, the stock suffered the biggest decline on the FTSE 100 Index.