India's capital market regulator, Securities and Exchange Board of India (SEBI) approved the proposal of Government to convert dues of over USD 1.92 billion by telecom operator Vodafone Idea to equity.

According to media reports the central government in year 2021 had approved a rescue package for debt-strapped telecom companies. It allowed them to convert interest on deferred adjusted gross revenue owed to the government into equity. Analysts saw this package as a bailout for Vodafone Idea, which was on the verge of bankruptcy.

Moreover, the market regulator has approved the government's request to classify its shareholding in Vodafone Idea as public float.

This arrived after the government had gave debt-laden telecom operators an option of paying the interest for four years of deferment on the deferred spectrum instalments and AGR (Adjusted Gross Revenue) dues by way of conversion into equity of the Net Present Value (NPV) of such interest amount in year 2021.

It is to be mentioned that the Government's stake in Vodafone-Idea after the conversion could be more than 30 percent.

At the same time, shares of VIL on October 20 closed 0.59 percent higher at Rs 8.57 apiece on the Bombay Stock Exchange (BSE).

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