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NEW DELHI: The Indian government’s decision to raise foreign direct investment limit for telecom companies is attracting competition from abroad.
With the telecom major’s struggling for the long distance license, it has caught the attention of the international telecom companies to invest in the growing Indian voice market.
The state-owned Mahanagar Telephone Nigam Limited (MTNL) has been granted the national long distance license, which brought a new tariff for calls between Delhi and Mumbai. Railtel Corporation of India Limited and the Power Grid have also been granted license.
The competition from abroad follows with British Telecom, after receiving clearance from the Foreign Investment Promotion Board (FIBP). The application was cleared in March this year. David Clarke, BT Asia Pacific spokesperson confirmed that the application was cleared by FIPB.
“We have not chosen an India partner yet for the 26 per cent holding, and we have not decided what type of license we will apply for and have not applied for a license as we, along with other foreign carriers, have sought certain clarifications on conditions. The government is reviewing these issues and we hope that a resolution with be available in the near future,” Clarke said.
However, it is certain that BT would soon be competing among the domestic carriers for the Indian voice market.
Clarke discarded reports, which said BT (India) Private Limited (BTIPL) has been providing end-to-end managed data services without a license, as “without substance.”
“BTIPL does not provide telecommunication services in its own name in India till now. Rather, under an arrangement with our partner, Bharti TeleVentures Limited (BTVL), it arranges for end-users in India to connect to BT's global network outside India by using the services and facilities provided by Bharti. BTVL is a service provider in India having all applicable licenses,” Clarke added.
It is now certain that the domestic carriers would receive a stiff competition from the foreign carriers after they are granted the long distance license.
However, according to industry sources, AT&T has applied for license with the Department of Telecommunications. It has also recently received the go-ahead signal from the FIPB and formed a joint venture with Mahindra Air Services called AT&T Global Network Services (AT&T GNS).
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