Govt waives bank guarantees for past spectrum auctions; letters sent to Vodafone-Idea, Reliance Jio and Bharti Airtel
bank guarantees worth about Rs 33,000 crore for past spectrum auctions to all three private operators — Reliance Jio, BhartiAirtel, and Vodafone-Idea (Vi). The bulk of the relief, amounting to Rs 24,800 crore, applies to Vi, a relative straggler.
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Vi, which is yet to roll out 5G services, now no longer needs to submit these bank guarantees, and the Centre’s decision now opens the space for lenders to extend much-needed credit to the struggling telco. It urgently needs funding to ramp up 4G coverage and roll out 5G soon to catch up with bigger rivals Jio and airtel.
The loss-making telco had previously said lenders were not willing to furnish the additional guarantees, given its financial stress.
“The letters to the telcos were sent on December 27,” an official privy to the details told ET.
The BG waiver will apply to spectrum auctions conducted in 2012, 2014, 2015, 2016, and 2021. Spectrum auctions conducted in 2022 and 2024 have already done away with the requirement for BGs based on the 2021 telecom reforms package.
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