Indian government serves notices in mobile licences affair

Nov 29, 2010, 14:29 GMT

New Delhi - The Indian government will serve showcase notices against 85 firms in a case which allegedly saw mobile phone licences sold off for up to 39 billion dollars below their market price, Telecommunications Minister Kapil Sibal said Monday.

Sibal was recently put in charge of the ministry after damaging allegations in selling the licenses forced his predecessor Andimuthu Raja to resign.

A government audit report accused Raja of selling 2G licences in 2008 at throw-away prices to selected people in a move that may have resulted in a loss of up to 39 billion dollars to the government exchequer.

Sibal, speaking at a press briefing in the Indian capital, said said 85 licensees would be sent notices and given 60 days to reply - after which the merits of each case would be considered before taking action.

Asked about foreign companies that had invested in the license-holding companies, Sibal said that was not a concern of the government. 'They should have checked before investing,' he said.

Several firms which got the licenses may have not met the eligibility requirements, Sibal added. 'We believe its about time that we issued notices to those who we believe might have suppressed facts, might have got undue advantage in accessing licences,' he added.

Sibal also said notices would be issued to 119 licensees, some dating back to 2006, for failing to meet roll-out obligations.

'We hope that this will send out a message that this government will not hesitate to ensure that the rule of law is honoured and that those guilty of transgressing it will be dealt with in accordance with law,' Sibal said.

Sibal also said there was need for a transparent, long-term policy framework for the fast-growing industry and no policy would be put out without thorough discussion with all sectors of the industry.

India has a telephone subscriber base of 706.37 million. The mobile market expanded by 40-45 per cent over the past two years.

The minister said investigators were probing allegations of involvement of government officials.

Opposition parties, however, continued to demand a cross-party parliamentary probe and forced adjournment of both houses of parliament. Legislative business has been stalled since November 9 over the 2G scam.

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