The Department of Telecommunication (DoT) will seek legal opinion and views of ministries of finance and external affairs on foreign telecom firms like Sistema and Telenor invoking bilateral treaties to protect their investments in the aftermath of Supreme Court cancelling their licences.
Sources said the Department of Telecom would seek opinion of the Attorney General (AG), the nation’s highest law officer, on whether the Supreme Court order — that cancelled 122 2G licences — can be challenged under bilateral investment protection treaties India has signed with various countries.
AG would be asked if foreign investors can claim damages from India for violation of the treaties and for failure to protect their investments.
Sources said DoT would also seek views of Department of Economic Affairs (Ministry of Finance), Department of Legal Affairs, Department of Commerce and Department of Industrial Policy and Promotion on the subject.
The Supreme Court had on February 2 quashed allotment of 122 2G licences given under the then Telecom Minister A Raja in 2008 on the ground that they were issued in a “totally arbitrary and unconstitutional” manner.
The decision impacted operators such as Uninor of Norway and Russia’s Sistema who had bought equity stakes in the Indian firms that were allocated 2G licences in 2008.
Since the order, foreign investors like Bahrain Telecom, a partner in S Tel, and Etisalat DB of UAE have announced closure of their operations in the country.
On the other hand, Telenor, which partners real estate firm Unitech in Uninor, and Sistema (joint venture partner in Sistema Shyam Teleservices (SSTL), have invoked bilateral treaties to secure their investments in the country.
DoT has also received representations from Unitech Wireless, S Tel, Loop Mobile Telecom and Etisalat DB for protection of their investments.
Sources said DoT believes that major foreign investment was directed through Russia, Singapore and Mauritius.
India has Bilateral Investment Promotion and Protection Agreement (BIPA) with Russian Federation and Mauritius, while a Comprehensive Economic Cooperation Agreement (CECA) with Singapore and Comprehensive Cooperation Partnership Agreement (CEPA) exists with Japan.
Keywords: 2G spectrum scam, 2G licence cancellation
If any foreign investor has invested in India and followed the due processes including taking due permission of FIPB then such institutions need to be protected. Siestama and Telenor seems to have compled with in full and then only started their operations. In the case of Telenor it the Unitech which swindled crores and it need to be punished. If in the worst scenario by June 2nd the Government dilly dallies I am sure it would be indeed difficult to attract foreign investments in the core sector and every investor would be wary of the Government. One has to separate the good from the bad ones and the good ones need to be protected.
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