Business Mantra News
Many Telecommunication Companies are heavily debted companies from various financial institutions.
These companies owed amounting Rs.5.80 Lakh Crores from various financial institutions and there are other spectrum payment obligations due towards these Telecommunication Companies.
Many of these companies are already undergoing Strategic Debt Restructuring towards total debts of Rs.60.0 thousand Crores.
The Indian Banks Associations (IBA) has asked the Government to allow the restructuring of debts owed by various Telecommunication Companies.
The IBA also haunted return of Bank Guarantees deposited by these Telecommunication Companies.
The Banks have recommended the Government to refund payment to companies which are undergoing restructuring.
The banks have requested the Government to cancel other spectrum payment liabilities of these Telecommunication Companies.
It is likely that if these proposals are accepted by the Government, these companies would be benefited.
Most of the telecom companies have borrowed from the Public Sector Banks.
The telecom operators have been allowed to surrender spectrum to the Government but they do not receive any refund and they are required to pay balance payment of the airwaves in installments.
Banks by suggesting the idea of releasing the bank from payment of restructuring debs and other spectrum liability will lower the payment owed by Telecommunication Companies and it would really help to overcome these stressed Telecommunication Companies from financial crisis.
The banks have also requested Department of Telecommunications to grant relief to the telecom operators and accept the proposals of the inter-ministerial group (IMG).
The IMG sought to relax these Telecommunication Companies by extending the terms of 12 years to 16 years for spectrum payment in auctions and by lowing the interest levies over penalties for nonpayment.