With conglomerate Sistema facing uncertain future following cancellation of its telecom licences, Russia, on Monday, set up a Parliamentary working group to protect interests of its companies working in India.
A Special Working Group will be established under Lower House of Russian Parliament (Duma) that “will develop necessary mechanisms for protection of the interests of the Russian companies working in India,” Russian news agency Interfac reported on Monday.
Sistema has a joint venture with India's Shyam Group, SSTL, in which the Russian government also has a stake of 17.14 per cent. Operating under the MTS brand name, SSTL has a user-base of over 15 million but its 21 licences were among the 122 cancelled by the Supreme Court in February this year.
The Special Working Group will be established under Property Issues Committee of the Lower House of the Russian Federation. “The need to organise such working group is stipulated by the fact that implementation of some major investment projects in India is currently facing serious hurdles,” Committee Chairman Sergey Gavrilov said in the course of its session. He said this, in particular, related to the problems faced by Sistema Shyam TeleServices Ltd (SSTL) and joint venture Kamaz Vectra Motors Ltd (KVML), where JSC Kamaz owns 51 per cent of shares.
The apex court had asked the government to conduct fresh auctions, the deadline of which has been extended to August 31 and the company can operate till September 7.
Since then, SSTL has moved a curative petition in the SC seeking re-examination of its verdict.
Sistema owns 56.68 per cent in SSTL, while 17.14 per cent belongs to Russian government and 23.98 per cent is owned by the Shyam Group. The remaining 2.2 per cent is free floating.
The Property Issues Committee recommended the Russian Government to reinforce co-ordination of activities of profile ministries with respect to prompt response on all issues related to securing rights and powers of Russian investors abroad. It further recommended to the Ministry of Economic Development of the Russian Federation that it evaluates the economic efficiency of all mutual investment protection agreements executed by the Russian Federation with other countries. Also, the Ministry should recommend quick solutions to protect the rights and powers of Russian investors abroad, including utilisation of international arbitration levers.
Law-makers are recommending Russian companies to review the issue of more active utilisation of opportunities envisaged by the bilateral agreement for the mutual protection of investments between Russia and India to compensate damages in cases of breach of ‘proprietorial rights' of Russian investors. The Kamaz affiliate is faced with labour issues in India.
