India’s third-largest service provider Vodafone Idea has announced a ₹450 billion ($4.89 billion) capital expenditure program over the next three years to accelerate its 4G and 5G rollout, improve network competitiveness and launch Fixed Wireless Access (FWA) services, marking its most significant investment push in years after government relief on legacy dues.
Vodafone Idea said the investment will focus on network expansion and modernisation, with the goal of closing coverage and quality gaps with larger rivals and reversing prolonged subscriber losses.
The plan follows a major policy reprieve after the Indian government granted the operator a decade-long deferment on payments related to adjusted gross revenue (AGR) dues, a long-running liability that had constrained Vodafone Idea’s ability to raise funds and invest in its network.
The company said it will use the new capex to expand 4G coverage across 17 priority telecom circles, which together contribute the bulk of its revenue to achieve network parity with competitors within 12 to 24 months. It also plans to extend 5G coverage to urban centres with populations above 20,000 over the next 12 to 30 months. About 70% of the planned investment will go toward radio access networks, with the remainder allocated to transport and core infrastructure upgrades.
Vodafone Idea is also preparing to enter the 5G-based fixed wireless access segment targeting Small Office and Home Office (SOHO) users, an area already being scaled by rivals Bharti Airtel and Reliance Jio as a key monetisation use case for 5G.
The operator said the capex will be funded primarily through debt, with plans to raise about ₹250 billion in bank financing and another ₹100 billion through non-funded facilities. It has ruled out an equity raise for now, stating that the current funding structure is sufficient to support the rollout.
Vodafone Idea has faced sustained financial and operational pressure for several years, weighed down by heavy AGR and spectrum liabilities, high debt and limited network investment. Funding constraints had slowed its 4G expansion and delayed its 5G launch, leading to weaker network experience and steady subscriber churn.
The company has been losing millions of users annually, though the pace of losses has moderated recently. Limited capex compared with competitors has been widely cited by analysts as a key reason for its declining market share and weaker customer perception.
By contrast, Airtel has been investing roughly ₹300 billion per year in network and digital infrastructure, while Jio has built a nationwide 5G footprint alongside continued 4G capacity expansion.
The renewed investment drive is expected to be critical not only for coverage and quality, but also for improving monetisation metrics. Vodafone Idea’s average revenue per user remains below peers. It reported ARPU of ₹186 in the December 2025 quarter, compared with about ₹256 for Airtel (September 2025 quarter) and roughly ₹214 for Jio.
Improved network performance and broader 4G and 5G availability will be essential if Vodafone Idea is to boost ARPU, reduce churn and stabilise its competitive position. While the announced spend still trails rivals in absolute terms, the planned rollout represents a meaningful reset for an operator that has spent the past several years in survival mode.
Besides, the planned capex on network modernization, the company will need to spend significantly on marketing as well to change the perception and to enhance its appeal with the new prospective customers. Suffice to say that the road ahead is not easy for the struggling telco.
