Vi's debt conversion may be the last resort for govt

Centre not keen on upping stake, wants telco to raise investments on its own

- SUBHAYAN CHAKRABORTY

The central government will study the matter of further converting Vodafone Idea's (Vi's) dues owed to it into equity only if no other options are available, officials said.

The Centre is not keen to raise its stake in the financially beleaguered telecommunications (telecom) operator and wants it to first raise investments on its own, they further said.

Since early 2024, Vi Chief Executive Officer Akshaya Moondra has repeatedly said the terms of the 2021 financial relief package allow it to seek further conversion of dues owed to the government into equity.

Regarding his latest letter to the Department of Telecommunications (DoT) seeking the same, officials said the telecommunications company (telco) was also expected back then to raise fresh capital from strategic sources on priority.

"The company has already done a significant fundraise. However, it has yet to secure major funds from banks and other lenders, which are needed to ensure its network expansion and long-term financial health. This remains a major hurdle before talks (on equity conversion) are taken further," a DoT official said.