Vodafone Essar bags NLD, ILD licences; granted permission to hive off tower business

1 Jul 2009

India’s Foreign Investment Promotion Board (FIPB) has given the nod to mobile operator Vodafone Essar’s applications for national long-distance (NLD) and international long-distance (ILD) licences, the Economic Times reports. The FIPB has also granted the operator a national internet service provider (ISP) licence; previously Vodafone held an ISP licence for the Gujarat circle only. In making its application for the licences Vodafone had said it hoped the NLD licence would enable it to reduce operating costs for carrying subscriber trunk dialling (STD) traffic as it would no longer rely on renting capacity on other operator’s networks.

It was also reported that the FIPB had given permission for Vodafone to divest its mobile towers and other related infrastructure to a separate arm, Ortus Infratel; it had previously deferred Vodafone plans to create Ortus Infratel twice on the back of concerns raised by the Department of International Taxation. Under the plans Ortus Infratel and Holdings will hold Vodafone Essar’s 42% stake in Indus Towers, a three-way joint venture between Bharti Airtel, Vodafone Essar and Idea Cellular that manages towers in 16 telecom circles.

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