Outstanding credit from banks to Indian telecom industry stands at Rs 76,977 crore

Telecom Lead India: The outstanding credit from public
sector and private sector banks to the entire telecom sector in India stood at
Rs 76,977 crore as on December 31, 2011.

There are widespread apprehension about bankers’ lack of
interest to fund telecom operators in India in the wake of 2G spectrum issue
and viability of the sector.

Indian telecom operators profit to decline 85% in 2011-12

Profit after tax of Indian telecom services segment is
expected to decline 85 percent in 2011-12, according to India Government’s
Economic Survey. The report said the significant decrease in profit is mainly
on account of the sharp rise in the industry’s interest outgo and higher depreciation
charges due to the heavy borrowings for acquiring 3G licences and rolling out
3G services.

2G issues have already prompted both telecom equipment
vendors and service providers to go slow in India. They are looking for a
predictable market in India.

Ericsson India looking for a stable and predictable telecom

Recently, Ericsson India head Fredrik Jejdling said the
company is looking at a market which is more stable and predictable in order to
improve business in 2012.

Due to delay in 2G investments and 3G expansion, many
leading equipment vendors could not meet their revenue targets in last two

Finance minister Pranab Mukherjee said banks have a total exposure of about Rs
28,000 crore to telecom companies for activities relating to licence fee and
roll out of 2G services.
The banks’ total outstanding exposure to companies for 2G related activities
including licence fees, roll out of 2G services, erection of towers, capital
expenditure and other operational expenditures as on December 2011 stood at
about Rs 19,135 crore in respect of Public sector banks and about Rs 8,803
crore in respect of private sector banks.
Telecom operator revenue in India grew 19 percent to Rs 49,877
crore in Q2 2011-12

Revenue of telecom operators in India grew at 19 percent in
Q2 2011-12 to Rs 49,877 crore from Rs 41,840 crore in Q2 2010-11.