The Union Cabinet has waived the requirement to submit bank guarantees for spectrum purchased through auctions held before 2022, according to sources.

The move brings huge relief to debt-ridden Vodafone Idea, which has already crossed the timeline to submit a ₹24,746.9 crore bank guarantee for spectrum payments between October 2025 and September 2026.

The decision will also benefit Airtel and Jio, which bought radiowaves through auctions held before 2022.

“Cabinet has waived the requirement of bank guarantees as per the relief sought by telcos,” a source said.

As part of telecom reforms announced in September 2021, the government has already waived the requirement of depositing bank guarantees for spectrum purchased through auctions.

Vodafone Idea CEO Akshaya Moondra said in the company’s earnings call that the bank guarantees will impact the company’s ability to seek debt facilities from banks, which the firm requires for network investment.

Shares of Vodafone Idea surged nearly 8 per cent on Tuesday amid reports that the Union Cabinet has waived the requirement to submit bank guarantees for spectrum purchased through auctions held before 2022.

The stock jumped 7.88 per cent to settle at ₹7.53 apiece on the BSE.

During the day, it soared 18.62 per cent to ₹8.28.

Industry body COAI on Tuesday said the Cabinet nod for bank guarantee waiver for past spectrum purchases is a “landmark decision” that would help reduce financial burden on telecom operators in the country.

The move will enhance cash flow, free up capital and enable capital investments in network expansion and technology upgrades,” SP Kochhar, director-general of COAI, said in a statement.

“By removing the bank guarantee requirements
retroactively, the government has created a more flexible
financial environment that will enable telecom operators to optimise their capital allocation, enhance liquidity, and accelerate infrastructure investments,” Manoj Kumar Singh, director-general, DIPA, said.