The Centre is planning to return bank guarantees (BGs) worth Rs 23,000 crore to debt-ridden telecom operators in connection with their outstanding adjusted gross revenue (AGR) dues.

Citing a senior government official, ET reported that the Department of Telecommunications (DoT) Cabinet note may fix 24 October 2019, as the date up to which the telecom department will calculate the AGR dues of the telcos.

The bank guarantees return stands to be a windfall for telcos, especially for Vodafone Idea (Vi) as the company is expected to get around Rs 15,000 crore. Similarly, Bharti Airtel has guarantees up to Rs 8,000 crore.

“The note is under consideration and will be floated to various ministries soon and this could come up in the Cabinet by the end of the month or early April,” the financial daily cited the official as saying.

Last week, Vi had reportedly asked the government to release Rs 15,000 crore in BGs, mentioning that the AGR and spectrum dues have been deferred by four years, and the DoT has the option to convert this into equity, there is no need to hold up the BGs for the same dues.

In September, the Union Cabinet had approved measures including a four-year moratorium on spectrum-related payments in an earnest attempt to give a boost to the current players.

Also, the cash-strapped company is leaving no stone unturned to raise funds by the self-mandated March-end deadline.

The official told the financial daily, “The guarantees could be returned…but to protect government revenue, 20% of the total dues could be submitted to the DoT a year before the AGR payments fall due.” Worth mentioning here is that the BGs are security deposits against the AGR dues telcos owe to the DoT.

Further, the BGs return will boost the lenders’ capital pool, allowing a loss-making service provider such as Vi to get more loans as it plans to infuse capital in its 4G network to take on deep-pocketed rivals Reliance Jio and check subscriber losses. Also, it requires funds to participate in the upcoming 5G spectrum auctions.