Telecom relief eases default risk for banks

Mumbai: The telecom relief package announced by the government on Wednesday will ease the default risk that banks were staring at from debt-laden Vodafone Idea Ltd (VIL). Besides, analysts also said the provisioning requirements for banks would also ease. However, bankers said they are awaiting the plan of action from the telecom companies to assess the situation.

According to analysts, VIL’s debt from banks and financial institutions stood at Rs 23,400 crore. Its AGR dues are over Rs 61,000 crore. It has near-term repayment obligations of Rs 6,400 crore over December 2021-March 2022 and additional deferred spectrum/AGR liability payment of Rs 15,700 crore/Rs 6,600 crore due in March 2022/April 2022 as of now. Its total debt is of Rs 1.9 lakh crore.