Scindia rules out higher govt stake in Vodafone Idea, says telco has to clear remaining dues

The Centre has no plans to convert any more of Vodafone Idea's statutory dues into equity,

The Centre has no plans to convert any more of Vodafone Idea's statutory dues into equity, communications minister Jyotiraditya Scindia has told The Economic Times, adding the remaining payments are the company’s responsibility.

“If we do that, Vi becomes a public sector undertaking (PSU),” Scindia said as he ruled out the government raising its holding in in the cash-strapped telco further from 49 percent.

The remaining dues, adjusted gross revenue (AGR) and spectrum-related payments, are now the company’s responsibility. “What is due to the government is due to the government. It is incumbent upon the players to pay that to the government,” he said.

Scindia also dismissed with a blunt “no” the speculation around a potential merger of Vodafone Idea with state-owned Bharat Sanchar Nigam Ltd (BSNL).

Talking about Elon Musk-owned Starlink’s satcom ambitions in India, Scindia said the company is yet to meet all licensing requirements.

“The minute you check all the boxes, you will get the licence,” Scindia said. He noted that the process involves clearances not just from the Department of Telecommunications (DoT) but also from bodies such as IN-SPACe and the telecom regulator (TRAI), especially for spectrum pricing and internal security compliance.

Starlink must still ensure that gateways and user terminals are located and registered within India, the minister said. “I hope it will be soon. All satellite companies must participate in Indian space. That gives my last-mile consumer connectivity,” he added.

In a significant milestone, BSNL posted a net profit of Rs 262 crore in the December 2024 quarter, its first in 18 years. “It is such a big deal after reporting a net loss for 72 quarters,” Scindia said.

On BSNL’s 4G rollout, the minister said 90,000 towers have been installed, so far, of which 76,000 have been commissioned. The rollout of 100,000 towers is expected to be complete by July.

He added that BSNL's 5G rollout will follow after the 4G network is stabilised and quality-of-service benchmarks are met.

When asked about allowing foreign equipment suppliers to bid for BSNL’s 5G contracts, Scindia said, “No, why should we? We have developed our own core and RAN. India is now in a select group of 4-5 countries that have developed 4G/5G technology.”

Scindia also outlined a transformation roadmap for India Post, which operates as a cost centre for the government with an expenditure of Rs 35,000–36,000 crore and revenue of Rs 12,000–14,000 crore.

“My hope is to eventually turn this into a profit centre,” he said, adding that the timeline for this transformation is five to six years.