Hangouts can access the following on your device:

Identity

• add or remove accounts
• find accounts on the device

Contacts

• modify your contacts
• read your contacts

Location

• approximate location (network-based)
• precise location (GPS and network-based)

SMS

• receive text messages (MMS)
• receive text messages (SMS)
• send SMS messages
• edit your text messages (SMS or MMS)
• read your text messages (SMS or MMS)

Phone

• directly call phone numbers

Photos/Media/Files

• read the contents of your USB storage
• modify or delete the contents of your USB storage

Camera

• take pictures and videos

Microphone

• record audio

Wi-Fi connection information

• view Wi-Fi connections

Device ID & call information

• read phone status and identity

Other

• read instant messages
• receive data from Internet
• Exchanges messages and receives sync notifications from Google servers.
• view network connections
• control vibration
• pair with Bluetooth devices
• run at startup
• change your audio settings
• use accounts on the device
• control Near Field Communication
• change network connectivity
• full network access
• send sticky broadcast
• prevent device from sleeping
• read Google service configuration

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Last Update: 06/12/2015

Source:
https://play.google.com/store/apps/details?id=com.google.android.talk