Banks' exposure to telecom sector at Rs 97,681 crore: FM Jaitley
For public sector banks, the gross Non Performing Asset (NPA) ratio and stressed advances ratio for the sector stood at 3.68 per cent and 11.29 per cent respectively, at the end of 2016-17 fiscal.
Finance Minister Arun Jaitley today said banks have an exposure of Rs 97,681 crore in the telecom sector, which is grappling with financial stress.
In a written reply to the Rajya Sabha, Jaitley said SBI Chairman has pointed out that stress in the telecom sector has reached "highly unsustainable levels" due to erosion of topline and earnings of the service providers.
Quoting the Reserve Bank of India figure, Jaitley said total outstanding (funded) advances by public sector banks to the 'communications' sector stood at Rs 63,415 crore, while total exposure to the sector worked out to be Rs 97,681 crore.
'Communications' sector include, telecom - fixed network; telecom towers; telecommunications and telecom services.
For public sector banks, the gross Non Performing Asset (NPA) ratio and stressed advances ratio for the sector stood at 3.68 per cent and 11.29 per cent respectively, at the end of 2016-17 fiscal.
Jaitley further said the SBI Chairman (Arundhati Bhattacharya) has made certain recommendations for tackling stress in the sector.
The suggestions, include aligning deferred payment liabilities for spectrum for its life, rationalisation of regulatory charges, quick resolution of litigation on definition of adjusted gross revenues, easing regulation of merger and acquisition.
"Government has already constituted an Inter-Ministerial Group for the sector," the financed minister said.
At present, a portion of spectrum auction amount is taken as upfront payment by Department of Telecommunication, and the rest after a two-year moratorium is paid out every year in 10 instalments.
The Indian telecom industry is locked in an intense tariff war following entry of Reliance Jio.
ALSO READ:No need for floor price for telecom services as of now: Trai
Telecom sector debt levels to reach Rs 4.8 lakh crore in FY18
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
RECOMMENDED STORIES
Retirement Planning: SIP+SWP combination; Rs 15,000 monthly SIP for 25 years and then Rs 1,52,000 monthly income for 30 years
Top Gold ETF vs Top Large Cap Mutual Fund 10-year Return Calculator: Which has given higher return on Rs 11 lakh investment; see calculations
Retirement Calculator: 40 years of age, Rs 50,000 monthly expenses; what should be retirement corpus and monthly investment
SBI 444-day FD vs Union Bank of India 333-day FD: Know maturity amount on Rs 4 lakh and Rs 8 lakh investments for general and senior citizens
EPF vs SIP vs PPF Calculator: Rs 12,000 monthly investment for 30 years; which can create highest retirement corpus
Home loan EMI vs Mutual Fund SIP Calculator: Rs 70 lakh home loan EMI for 20 years or SIP equal to EMI for 10 years; which can be easier route to buy home; know maths
06:25 PM IST