Debt-ridden Vodafone Idea seeks waiver of Rs 25000 crore bank guarantee from DoT

Debt-ridden Vodafone Idea has reached out to the Department of Telecom to seek a waiver of its obligation to submit a bank guarantee worth ₹24,747 crore for spectrum payment due in September 2025, according to sources.

Vodafone Idea (VIL) needs to securitise the annual instalment one year before the due date of the payment.

Debt-ridden Vodafone Idea has reached out to the Department of Telecom to seek a waiver of its obligation to submit a bank guarantee worth ₹24,747 crore for spectrum payment due in September 2025, according to sources.

Vodafone Idea (VIL) needs to securitise the annual instalment one year before the due date of the payment.

“Vodafone Idea has reached out to DoT seeking waiver for financial bank guarantee (FBG) worth ₹24,747 crore which it has to pay in September 2025. The FBG needs to be deposited one year before the due date as per spectrum auction rules,” a source, who did not wish to be identified, said.

An email query sent to Vodafone Idea elicited no response.

Debt-ridden Vodafone Idea has reached out to the Department of Telecom to seek a waiver of its obligation to submit a bank guarantee worth ₹24,747 crore for spectrum payment due in September 2025, according to sources.

Vodafone Idea (VIL) needs to securitise the annual instalment one year before the due date of the payment.

“Vodafone Idea has reached out to DoT seeking waiver for financial bank guarantee (FBG) worth ₹24,747 crore which it has to pay in September 2025. The FBG needs to be deposited one year before the due date as per spectrum auction rules,” a source, who did not wish to be identified, said.

An email query sent to Vodafone Idea elicited no response.

The payments are for frequencies that VIL purchased in auctions that were conducted before 2022. VIL in 2022 opted for a four-year moratorium to pay for the spectrum allowed under a government relief package.

The moratorium period for the spectrum payment obligations related to spectrum auctions conducted until 2016 ends between October 2025 and September 2026.

The company also opted for a moratorium on AGR payments. The moratorium ends in March 2026. VIL is required to provide bank guarantees at least 13 months prior to the expiry of the relevant moratorium period.

The company has cited relief based on the spectrum auction rules of 2022 and 2024 in which the requirement for providing bank guarantees for the annual instalments has been removed.

VIL had outstanding dues of ₹2,03,430 crore to the government as of March 31, 2024. The total outstanding includes deferred spectrum payment obligations of ₹1,33,110 crore and AGR (adjusted gross revenue) liability of ₹70,320 crore.

While opting for the moratorium, VIL cleared about ₹16,000 crore interest obligation on the deferred payment by offering equity in the company to the government.

he government shareholding in VIL fell from about 33 per cent 2023 to 23.8 per cent as of March 31, 2024, after the company raised ₹18,000 crore through a follow-on public offer, ₹7,000 crore between March 2022 and May 2024 from the promoters and issued preferential shares to vendors to clear their dues.