India’s Ministry of Home Affairs has called for the re-introduction of the 74% foreign ownership cap in the telecom sector on the grounds of security concerns, the Economic Times writes. In a note to the Department of Industrial Policy and Promotion, the Home Ministry claimed that foreign direct investment (FDI) rules should be re-evaluated, taking into consideration the information regarding surveillance programmes uncovered by former US National Security Agency (NSA) contractor Edward Snowden. The Ministry noted that the telecom sector was ‘sensitive’, adding that ‘remote access and encryption remain, and are of increasing concern.’ A reduction in the FDI cap to 74% would cause problems for Telenor and Sistema Shyam TeleServices (SSTL), the parent companies of which have applied to the Foreign Investment Promotion Board (FIPB) for permission to increase their ownership to 100%. The government has stressed, however, that it has no intention of making policy changes retrospective, as such action has proved highly disruptive to business. Nevertheless, any backpedalling is likely to harm the sector, bringing to the fore issues of regulatory uncertainty that have plagued the market in recent years.
Subscribe to CommsUpdate to get the day’s top telecom headlines delivered to your email.
Have feedback, corrections, or story ideas? Send them to email@example.com.
Browse Past Issues
Filter CommsUpdate by the following categories or use the search.
Visit our help page information on performing advanced searches, including how to restrict the results by country or company.
CommsUpdate is an outstanding advertising venue for companies seeking to reach:
- International carriers
- Wholesale service providers
- Equipment and software vendors
- Telecom investors