ALSO READMoody's, Fitch cut India's RCom to default, warn on debt levels Global warming to hit Indian dairy sector hard, warn experts Banks express concern over stress in telecom sector SBI's proposed debt less likely to default at BBB- by Fitch Pakistan's external debt to grow to USD 110 billion in next four years, warn experts
Banks which have lent to telecom companies are worried about the financial health of the sector which is under debt stress. Many of them feel there may be defaults in the future.
"The bankers are worried. They feel one might see defaults in future unless some solution is found soon," said an official.
Four banks -- State Bank of India, Punjab National Bank, HDFC Bank and Axis Bank -- on Wednesday met the members of the inter-ministerial group (IMG) formed to look into the health of the telecom firms.
The telecom sector's debt is estimated to be over Rs 4.6 lakh crore.
None of the officials or the bankers were ready to provide detailed information on what was discussed during the two-hour meeting.
Punjab National Bank officials, coming out of the meeting, admitted that there was stress in the sector and that there was an urgent need to find a solution.
They were not willing to come on record since they were not authorised to talk to the press. The officials said that revenues in the sector were coming down and this may further worsen the situation.
SBI's exposure alone to the telecom sector is around Rs 70,000 crore.
The bankers may meet the IMG, composed of officials from the finance and communications ministry, again soon.
Axis Bank officials said liquidity has to increase in the telecom sector, otherwise the situation will deteriorate.
This is the third meeting of the group in the series of stock-taking meetings. The officials met four telecom firms -- Reliance Jio, Reliance Communications, Aircel and Tata Teleservices -- on Monday. A meeting with BSNL and MTNL was held on Tuesday.
Bharti Airtel and Vodafone India are scheduled to meet the group on Friday.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)