Reliance Jio said on Wednesday that it had paid the Department of Telecom Rs 30,791 crore, including accumulated interest, to satisfy the total spectrum payments liabilities that the firm bought prior to the March 2021 auctions.
The payments cover liabilities related to the spectrum obtained in auctions in 2014, 2015, and 2016, as well as spectrum acquired in 2021 through right-to-use trading with Bharti Airtel Limited, according to the business.
‘Reliance Jio Infocomm (RJIL)… has paid Rs 30,791 crore (including accrued interest) to the Department of Telecom towards prepayment of the entire deferred liabilities pertaining to spectrum acquired in auctions of year 2014, 2015, 2016 and the spectrum acquired in year 2021 through trading of right to use with Bharti Airtel’, the company said in a statement.
Through these auctions and transactions, the business was able to obtain 585.3 MHz spectrum. ‘The company estimates that the above prepayments will result in interest cost savings of around Rs 1,200 crore annually, at the current interest rates’, the statement said.
Even though the government offered Reliance Jio the option of a four-year freeze on all spectrum-related payments, the company settled all outstanding debts. RJIL had completed the first tranche of payments for spectrum bought in an auction in 2016 on the anniversary date in the month of October 2021.
Following the Department of Telecom’s decision in December 2021 to allow telcos to prepay their deferred spectrum liabilities on any date, RJIL has now prepaid the entire deferred liabilities acquired in the auction in 2014 and 2015, as well as the spectrum acquired through trading, in the month of January 2022.
These liabilities were due in yearly instalments from fiscal years 2022-23 to 2034-2035, with an average residual time of more than seven years and an interest rate of 9.30 to 10% each year.
Bharti Airtel paid the Department of Telecom Rs 15,519 crore last month to prepay the whole deferred liability relating to the spectrum purchased in the 2014 auction.