M A I N   N E W S

2G verdict fallout: PM meets his team
Girja Shankar Kaura/TNS

New Delhi, February 11
Facing adverse market reactions and under diplomatic pressure in the wake of the recent cancellation of the 122 second generation (2G) Spectrum licences by the Supreme Court, Prime Minister Manmohan Singh today held a crucial meeting with senior Cabinet colleagues about its overall impact on the telecom sector and the way forward.

The meeting held at the Prime Minister’s residence was attended by Finance Minister Pranab Mukherjee, Home Minister P Chidambaram, Telecom Minister Kapil Sibal and Law Minister Salman Khurshid. Attorney General GE Vahanvati and Telecom Secretary R Chandrashekhar were also present.

The meeting is also believed to have discussed the fallout of the cancellation of 2G licences on the telecom sector which has become an important segment of the economy.

The meeting assumes greater importance in the wake of intense diplomatic pressure on the government especially from Norway and Russia. The Norwegian and Russian Governments have major stakes in their local telecom firms that have, in turn, picked up majority stakes in joint venture partnerships in the affected telecom firms here.

The two governments hold majority stakes in Telenor and Sistema, respectively, which have partnered with Unitech and Shyam Telecom for the Uninor and MTS telecom brands operating here.

With Telenor having invested over Rs 14,000 crore in the Indian operations here, the Norwegian Government, earlier this week, had sent its Minister for IT, Government Administration, Reform and Church Affairs Rigmor Aasrud for a meeting with Kapil Sibal.

The Norwegian Government categorically told Sibal that Telenor was not at fault and was facing cancellation of licence despite having entered the Indian market only after the licences had been issued.

Sistema claims to have also invested over Rs 12,000 crore and was seeking protection from the Indian Government for its investments.

Reports suggested that in the wake of all the pressure and with the affected companies also looking to file a review petition in the Supreme Court, the Prime Minister also asked for the Attorney General's opinion within a week.

The Telecom Secretary apprised the Prime Minister and the other ministers present about the finer points of the judgment and its impact on the telecom sector, keeping in mind the possibility of FDI flow getting affected.

"Ultimately, all the matters have to go to the Cabinet so the government has to be informed before that in order to take a decision," he added.