The Reserve Bank of India (RBI) has reportedly expressed its concern about the fallout of the Supreme Court (SC) order on telecom dues and is watching developments in the industry closely.
As per RBI, further tariff hikes, as sought by telecom operators, could be inflationary. Further, the central bank also expressed its concern that SC’s order can indirectly affect the banks, which have substantial exposure to telecom companies leading to bad loan pile.
As per industry sources, the government is working on a potential rescue plan for the sector and is likely to consider RBI’s request. To ease the burden on telcos, RBI had requested the government to allow telecom companies to stagger their payment of dues to the government over the next two-three years.
Meanwhile, RBI’s monetary policy committee had also cautioned about the impact of tariff hikes on inflation.