Loans to 2G licence holders in line with norms, says RBI

The Reserve Bank of India (RBI) today exuded confidence that loans given to 2G spectrum licence holders would not turn into bad debts on account of the scam in allocation of radiowaves.

All loans had been given following normal procedures, RBI Deputy Governor K C Chakrabarty told reporters in Vendoni village near here.

He said RBI had verified and no improper sanction of loan for companies that had obtained 2G spectrum licences had come to its notice. “I don’t see any major problem for the banks who have lent money to 2G spectrum licence holders. There is no chance of any loan (to 2G spectrum licence holders) going NPA (non-performing assets). We will able to recover the loans.”

It has been alleged that 2G licences issued to private telecom players at throwaway prices in 2008 caused huge losses to the exchequer. The Comptroller and Auditor General of India (CAG) has quantified the losses at around Rs 1.76 lakh crore.

The 77-page report of CAG, tabled in Parliament, said due diligence was not followed and even the recommendations of the Telecom Regulatory Authority of India were “not followed in spirit”.

The report also said “undue” benefits were given to new players.