Indian telcos to opt for three-month moratorium on loan repayments during Covid19 lockdown

India’s government is in the process of devising a range of economic initiatives to help businesses withstand the financial pressure brought about by the Coronavirus pandemic
India, Financials, Telecoms, Covid19, Telcos

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India’s cash strapped telcos will likely opt for a three-month moratorium on EMI payments, to ease cash flow anxieties during the country’s Covid19 lockdown, according to a statement from the COAI.
“There is debt of around 1.6-2 lakh crore rupees [$22-$26 billion] that telecom operators owe Indian banks. They will opt for a three-month moratorium in loan repayments to help them maintain cash flow. It is a relief for them,” the COAI’s director general, Rajan S Matthews, told members of the press.
As is the case across the world, the Indian government is in the process of putting together a raft of packages to help businesses survive the mid to long term impact of the global Covid19 Pandemic. Businesses will be granted a three-month moratorium on loan repayments, to ease cash flow whilst much of the population remains in lockdown.
India’s cash strapped telecoms operators will welcome the payment holiday as they are already struggling to meet the demands of brutal market conditions.
With average revenue per user hovering around the $1.50 mark, Indian telcos were already trading on wafer thin margins, whilst attempting to balance the enormous capital investment demands of 5G. As huge swathes of India’s 1 billion plus population opt to work from home, operators will need to ramp up investment in the short term, to ensure that they can meet the extra demand for capacity.

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