Jio pre-pays ₹30k cr, clears spectrum dues
NEW DELHI: Reliance Jio Infocomm Ltd, India’s largest telecom service provider, prepaid ₹30,791 crore of deferred spectrum liabilities to the government to save on interest costs, clearing all such dues incurred before March last year.
The company estimates that the prepayments will result in around ₹1,200 crore of interest cost savings annually, Reliance Jio said in a statement on Wednesday. The liabilities were due in annual instalments from FY23 to FY35 and carried interest rates between 9.3% and 10% per year, with an average residual period of over seven years.
The deferred liabilities pertained to 585.3 MHz units of spectrum acquired in auctions of 2014, 2015, 2016 and from rival Bharti Airtel Ltd in 2021.
“Subsequent to the department of telecom’s decision in the month of December 2021, providing the telcos the flexibility to prepay their deferred spectrum liabilities on any date, Reliance Jio has now prepaid in the month of January 2022, the entire deferred liabilities acquired in auctions in the years 2014 and 2015 as well as spectrum acquired through trading,” it said in a statement.
Jio had executed the first tranche of prepayment in October for the spectrum acquired in an auction in 2016. It had paid ₹10,792 crore to the government for 269.2 MHz of spectrum it acquired.
The telecom service provider is the only one among major telcos to not opt for a moratorium on spectrum and adjusted gross revenue payments by four years, an option given by the government to all carriers as part of a rescue package issued to aid the sector in September.
Last month, Bharti Airtel prepaid ₹15,519 crore to the telecom department towards deferred liabilities emanating from acquiring 128.4 MHz of spectrum acquired in 2014 auctions, including airwaves from Telenor for a total of ₹19,051 crore, which was due from FY27 to FY32 and carried an interest rate of 10%. The prepayment saved the carrier₹3,400 crore in interest, it had said.