Sibal seeks assistance of PM, FM for bank loans to telcos

Sibal seeks assistance of PM, FM for bank loans to telcos

New Delhi: Union telecom minister Kapil Sibal on Monday held a joint meeting with Prime Minister Manmohan Singh and finance minister Pranab Mukherjee seeking their intervention to ensure bank loans to telecom projects in the wake of the 2G spectrum scam.

“Yes we have met," Sibal said when asked if he met FM and PM on Monday morning. He however, did not elaborate the details of the meeting.

Sources in the know, however, said they discussed the issue of de-freezing of loans to the telecom firms by the banks and other financial institutions.

Earlier this month, Sibal had written to Prime Minister on the difficulties being faced by telecom companies to raise loans from the banks saying if not remedied swiftly, it could embroil the sector in a financial and legal quagmire.

There appears no speedy resolution of the 2G scandal, or much scope of interim relief for the industry, given that the Supreme Court is directly supervizing the CBI probe.

Under the circumstances, it is uncertain what the finance minister and Prime Minister could do to meet telecom companies’ funding needs.

The reasons for banks not funding some of the new entrants may not be merely default fear and also due to the 2G licence issue becoming a scam.