extending fresh funding to Vodafone Idea (Vi) after the government approved a relief package that freezes the telecom operator’s adjusted gross revenue (AGR) dues and allows repayments to be spread over 16 years, according to an Economic Times report. Bankers said the move has reshaped Vi’s liability profile, although any decision on new lending will depend on clearer visibility into the company’s funding needs and long-term business strategy. Lenders have so far remained cautious due to Vi’s substantial statutory liabilities, weak cash flows and concerns around its ability to service additional debt.
“Our team will reassess the possibility of extending fresh funds in light of the new developments,” a senior bank executive familiar with the matter was quoted as saying. Another banker noted that Vi had earlier indicated a funding requirement of ₹35,000 crore. “We now need to assess how much funding is required and what is feasible based on the company’s cash flows. Given the size of the amount, it would require a consortium of lenders, which will need to deliberate and take a collective call,” the banker said on condition of anonymity.
Last week, the Department of Telecommunications (DoT) froze Vi’s AGR dues of ₹87,695 crore for the period from 2006–07 to 2018–19 and permitted staggered repayments until 2041. Under the revised schedule, the company will pay ₹124 crore annually between March 2026 and 2031, followed by annual payments of ₹100 crore from March 2032 to 2035. The remaining dues will be repaid in equal annual instalments from March 2036 to 2041, after a DoT-appointed committee reassesses the final liability. This effectively means nearly 95 percent of Vi’s AGR liability will remain frozen for the next decade. “This is a significant development as it deals with a big overhang,” a second bank executive was quoted as saying. “Vi needs funds. But banks will look to also hear from the company on its needs and plans for the future.”The relief has eased near-term payment pressure on Vi, which was facing obligations of about Rs 16,400 crore in March 2026. However, the company continues to carry a total debt burden of nearly Rs 2 lakh crore, largely comprising statutory dues, including around Rs 1.2 lakh crore in spectrum liabilities.
While several banks currently have no direct exposure to Vi as earlier loans have been repaid, they remain engaged with the company, a banker reportedly said. Fresh funding is seen as crucial for sustaining network investments, especially since Vi has already utilised more than Rs 20,000 crore raised through an equity issue in April 2024.Unnamed market experts were quoted as saying Vi may also explore tapping the equity markets or bringing in a strategic investor. According to earlier reports, the government is scouting for a strategic investor to infuse USD 1 billion for an 11–13 percent stake in the company, with US private equity firm Tillman Global Holdings among those reportedly in talks.