Four large banks that met an inter-ministerial group (IMG) expressed concern over stress in the telecom sector and flagged the possibility of loan default by operators.
The IMG met officials from four leading banks — State Bank of India, Punjab National Bank, Axis Bank and HDFC Bank on financial difficulties being faced by the telecom industry, whose debt burden stand at a whopping Rs 4.6 lakh crore.
The banks in the two-hour meeting talked about measures that can be taken to enhance liquidity. They added that the IMG may meet the banks once more but the date has not been finalised yet.
The IMG, comprising officials from ministries of communications and finance, is meeting operators and lenders to discuss financial difficulties being faced by the industry, and measures that can be taken to ease the situation. Last month, SBI chairman Arundhati Bhattacharya in a letter to the telecom secretary had expressed concern over the stress in the telecom sector reaching unsustainable levels.
The bank also sought immediate and large scale intervention to stem the slide. It has asked for deferred payment liability for spectrum to be aligned to 20 years, rationalisation of GST rates, as also licence fee and spectrum usage charges.
By Baishakhi Dutta