TeleGeography Logo

Vi Should Be Dancing: Govt confirms plans to release BGs

31 Mar 2022

The Indian government is planning to return to telcos bank guarantees (BGs) submitted for deferred payments for spectrum rights purchased at auctions in 2012-2016, the Economic Times writes, citing Minister of State for Communications Devusinh Chauhan. Responding to a question in parliament, the minister explained that the companies would be required to resubmit the BGs but would not have to do so until 13 months before the next payments are due post-moratorium. Vodafone Idea (Vi) and Bharti Airtel both accepted the government’s offer of a four-year moratorium on the payment of spectrum dues which had been extended as part of a package of industry reform and relief measures in September last year. In addition, Airtel has prepaid a portion of its deferred liabilities for spectrum auctions during that period, most recently it announced last week that it had paid INR88.15 billion (USD1.16 billion) towards instalments that were due in 2027 and 2028 from the acquisition of frequencies in 2015. The return of the BGs – estimated to be worth around INR150 billion for Vi and INR70 billion for Airtel – is expected to provide a shot in the arm for debt-laden Vi, which has been struggling to raise funds to drive 4G network expansion and upgrade works.

Meanwhile, the aforementioned reform package also lowered the requirement for BGs to 20% of the statutory dues demanded by the government (from 100% previously) and, as such, the resubmitted BGs for the remaining dues after the moratorium period are expected to be substantially lower.

GlobalComms Database

Want more? Peruse the GlobalComms Database—the most complete source of intel about mobile, fixed broadband, and fixed voice markets.


TeleGeography is the definitive source for telecom news, numbers, and analysis. Explore the full research catalog.