Adani halts telecom ambitions, transfers spectrum rights to Bharti Airtel | Mint

The Adani group has effectively shelved its telecom ambitions, agreeing to transfer rights to 400MHz of 26GHz spectrum to Bharti Airtel Ltd for a fee, signalling a pause in its plans to connect its infrastructure assets.

Adani Data Networks, a wholly owned subsidiary of Adani Enterprises Ltd, on Tuesday said it has signed definitive agreements with Bharti Airtel and its arm Bharti Hexacom to transfer the rights to use 400MHz of spectrum in the 26GHz band. With this move, Adani has effectively signalled a pause to its ambitions to use the telecom licence and spectrum to connect its ports, airports and other facilities.

Notably, Adani has paid around ₹57 crore to the department of telecommunications (DoT) for the spectrum purchase and the remaining amount of over ₹150 crore (excluding interest) will be paid by Airtel to DoT over the years, officials aware of the matter said. In addition to the payment, there will be an interest component in the yearly instalment method, officials added.

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The spectrum trading assumes significance as the Adani group, which acquired the spectrum for ₹212 crore in a 2022 auction, was not able to deploy it for connectivity in its ports, airports, logistics, power plants, etc.

“Airtel has taken over the payment obligation from Adani. Now onwards, Airtel will pay the annual amount to DoT in August every year,” an industry executive said, asking not to be identified.

The 26GHz band is crucial for enterprise connectivity and would be required for telecom operators to build capacity going forward to handle the increase in traffic on 5G, analysts said, adding that the band has less device ecosystem and is not being put to use widely. Telecom operators Jio and Airtel have been using some 26GHz spectrum band in rolling out the fixed wireless access (FWA) broadband services as well.

“The spectrum covers six telecom circles—Gujarat (100MHz), Mumbai (100MHz), Andhra Pradesh (50MHz), Rajasthan (50MHz), Karnataka (50MHz) and Tamil Nadu (50MHz),” Adani Enterprises said in an exchange filing.

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In a separate filing, Airtel said, “The closing of the transaction is subject to satisfaction of the standard conditions (including conditions stated in the Spectrum Trading Guidelines) and statutory approval(s).”

In July 2022, Adani Data bought 400MHz of spectrum in the 26GHz band after acquiring the unified licence, which is needed to provide telecom services. At that time, the Adani group clarified that it will not provide consumer mobility service and use the spectrum for private captive networks for connectivity in ports, airports, logistics, power generation, etc.

“The 26GHz band is yet to find a use case worldwide. There is no benefit for Airtel at the moment, but the spectrum has future potential once the ecosystem grows. There will be a requirement for enterprise connectivity and industrial automation solutions through captive private networks,” said Satya N. Gupta, former principal adviser at the Telecom Regulatory Authority of India (Trai).

The private network as a use case for 5G, however, has not picked up so far in the country, according to Gupta.

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Lately, DoT also sent multiple communications to Adani Group asking why the company was not able to meet minimum rollout obligations of launching 5G services, officials said, adding that the company was looking at the option to surrender or trade the spectrum as it was unable to find use-cases for its deployment.

At that auction, Airtel had acquired 17,600 MHz of 26GHz spectrum for ₹5,592 crore.

Adani, however, continues to hold the unified licence, which means that it can enter the telecom sector whenever it wants to at a later stage, another industry executive said.