Debt-laden telecom operator Vodafone Idea (Vi) has finalized a $3.6 billion agreement with Nokia, Ericsson, and Samsung for the supply of network equipment over the next three years. This move is part of Vi’s broader $6.6 billion capital expenditure plan aimed at expanding its 4G coverage from 1.03 billion to 1.2 billion people, launching 5G services in key markets, and addressing data capacity needs.
The deal comes at a critical moment for Vi, as earlier this week, the Supreme Court rejected curative petitions filed by both Vi and Bharti Airtel, in which they sought corrections to what they termed ‘arithmetical errors’ in the Department of Telecommunications’ (DoT) calculation of adjusted gross revenue (AGR) dues. As of March, Vi owed over ₹2 lakh crore to the government, including ₹1,33,110 crore in deferred spectrum payments and ₹70,320 crore in AGR liabilities.
Despite significant financial pressures, this deal marks a step forward in Vi’s efforts to roll out 5G services, lagging behind competitors Reliance Jio and Bharti Airtel, who are already nearing nationwide coverage. Vi highlighted that the new contracts would facilitate a more flexible and modular rollout plan, enhancing both 4G and 5G services. Additionally, the new equipment is expected to improve energy efficiency and lower operating costs.
Vi had previously raised $240 million to meet its financial obligations and is now in advanced discussions with lenders to secure further funding, amounting to ₹250 billion in funded facilities and ₹100 billion in non-fund-based support. The supply of equipment from these new contracts is set to begin in the upcoming quarter.
