Kapil Sibal meets Prime Minister and Finance Minister for Telcos Loan

Telecom Minister, Mr. Kapil Sibal yesterday met Prime Minister Manmohan Singh & Finance Minister Pranab Mukherjee to discuss the issue of freezing of loans by banks & other financial institutions to telecom companies. “Yes we have met,” Sibal told reporters without giving the details of his meeting with the Prime Minister and Mr. Mukherjee.

Ever since the 2G spectrum scam have surfaced, Banks & Other financial institutions have stopped further processing of loans impacting the expansion plans of telecom companies. Banks have also threatened to recall loans processed following the department of telecom’s move to cancel licenses of firms that have failed to meet rollout obligations for second-generation (2G) services.

Earlier this month, Sibal had written to Prime Minister on the difficulties being faced by telecom companies to raise loans from the banks. The recent 1,00,000 crore 3G spectrum auction was more or less supported by bank loans. Also after auction, companies had taken large amount of loan for deploying 3G network in place.

The issue if not dealt with immediately could impact the growth of telecom sector.

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