India committed to protect foreign investment: Sibal
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India on Saturday assured Norway that foreign investments would be protected amidst the Scandinavian nation saying it apprehended political implications if Telenor suffered losses due to adverse telecom developments in this country.
Telecom Minister Kapil Sibal told the Norwegian Trade and Industry Minister, Trond Giske, that the Indian government is committed to protecting foreign investments and ensuring a robust roadmap for them.
"There is absolutely no room for concern. Government of India is committed to protect foreign investments in India and make sure that not just Telenor, but all foreign investors have a robust roadmap ahead," Sibal said.
Giske is the representative of Norwegian government on the board of Telenor, which holds 67.25 per cent stake in the telecom operator, Uninor.
The balance is held by Unitech. Uninor's 22 licences were among the 122 licences cancelled by the Supreme Court on February 2, issued during the tenure of the then telecom minister A Raja.
Uninor has permit to operate till September 7. When asked about the meeting, Sibal said he told the Norwegian Minister that:
"We will take into account all concerns of Telenor as we decide on our policy".
Earlier in the day, Giske had indicated that any failure of Telenor's USD 3 billion investment in India could have political implications.
"Telenor is not just any company. 54 per cent of the shares are owned by Norwegian people through state and thus, it has even further political implications that such a company will be harmed.
"If this investment fails, it will be probably the biggest loss a Norwegian company has in foreign investments ever. I think also it will be fair to say that it will influence the view of India as an investment country," Giske had told reporters here.
Giske termed his meeting with Sibal as 'friendly'.
"I think the discussion we had were government friendly. We were received at all political meetings with understanding and hospitality and also an assurance that they hope to find solution that ensures Telenor presence in India," Giske told reporters, after his meeting with Sibal.
To continue its telecom operations, Telenor needs to acquire new licences and win spectrum through the upcoming auction. However, the company has expressed concern over the auction proposals of telecom regulator, Trai. Telecom Regulatory Authority of India (Trai) had suggested a base price of Rs 3,622 crore for one megahertz (MHz) for pan-India spectrum.
This is around 10 times higher than the price at which 2G licences bundled with 4.4 MHz spectrum were allocated in 2008 during Raja's tenure.
According to Trai's recommendations, a minimum of 5 Mhz spectrum should be allotted, which means that pan-India airwaves in 1800 MHz band will cost Rs 18,100 crore.
Telenor has objected to the high base price recommended by Trai along with network roll-out obligations and the quantum of spectrum proposed for auction.
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