Indian ministry proposes lifeline for foreign telcos

30 July 2012 |


India’s Ministry of Commerce and Industry has reportedly proposed that mobile operators which lost their 2G licences in February’s Supreme Court ruling could avoid having to participate in the country’s re-auction but still regain their licences.

Should the proposal go ahead it would offer a lifeline to the likes of Telenor and Sistema by allowing them to match the auction price rather than having to bid themselves, according to India’s Economic Times.

Among the advantages of the move would be in reassuring foreign investors about India and the “inherent fairness” of its system, the Ministry of Commerce and Industry said in a communication.

Several foreign operators lost out in the wake of the Supreme Court’s cancellation of 122 licences, with Etisalat and Batelco deciding to abandon their Indian investments.

Nordic carrier Telenor has made a significant enough investment in its joint venture Uninor that leaving would be a less feasible option, but uncertainty over the company’s future in India has taken its toll. Last week Telenor announced that Uninor would reduce operations to focus upon its nine core telecoms zones.

India’s telecoms ministry will reportedly await the cabinet’s decision on auction pricing before deciding itself on the issue. The ministry is also said to be considering forwarding the suggestion to India’s Attorney General and is seeking legal advice on the matter.

The country’s government is expected to approach the Supreme Court in the coming days to seek an extension of the August 31 deadline for completing the 2G re-auction. A plea must be filed by August 10 for an extension to be considered.