NEW DELHI: Days after the government has agreed to convert interest dues of debt-laden Vodafone Idea (VIL) related to deferred AGR and spectrum usage charge (SUC) payments into equity, the government is of the view that the telco would not find it difficult to raise funds as it has reputation, network and proper infrastructure
A senior official from the Department of Telecommunication (DoT) told this newspaper on condition of anonymity that the next four year is good time for telco to improve its services and stay in the market.
This is the time for VIL to raise funds and invest in its infrastructure.
It is a perfect time (four year moratorium) for the telco to invest in its services like 5G so that it can catch up with its competitors. I don’t think the telco has much liability in these years, thus it should focus on improving its services and rolling out its 5G network,” said the official.
VIL, India’s third-largest telecom operator, has been trying to raise funds for the past few years, but failed to do so. Currently, it has a net debt of about Rs 2.2 lakh crore, and experts believe VI needs about Rs 50,000 crore capital support. However, following the equity conversion from the government, the telco is back to get funds. As per the reports, it recently approached State Bank of India, Punjab National Bank and HDFC Bank to refinance Rs 3,000-4,000 crore of loans.