Sistema reiterates faith amid lawsuits by telecom firms

Mr. Vsevolod Rozanov, President & CEO, MTS India

Mr. Vsevolod Rozanov, President & CEO, MTS India

Company chairman indicates it is here for a long haul and the possibility of bidding for both GSM & CDMA spectrum which will be up for auction soon. At a time when some of the new telcos along with their foreign partners have announced their exit, Vladimir Evtushenkov, chairman of the Russian conglomerate Sistema, came to India, earlier this week, to cool the nerves of its employees and business partners.

According to Nivedita Mookerji (Business Standart) The message sent across by him was the company was here for a long haul, and that it might bid for both GSM (global systems for mobile communications) and CDMA (code division multiple access) spectrum which would be up for auction. Currently, it is only a CDMA operator.

Reiterating the group’s commitment to the Indian market, Evtushenkov told employees of MTS, the telecom brand offered by Sistema Shyam Teleservices Ltd (SSTL), in an informal address that all was well with operations here. He also told them the group would bid in the upcoming auctions across technologies (GSM and CDMA), according to company sources. He tried to allay any fears of job loss in the current scenario of political uncertainties, reports Mr. Mookerji, reffering official sources.

Evtushenkov met representatives of the government, including Communications Minister Kapil Sibal during the visit to discuss the licence cancellation issues, sources said.

The SSTL spokesperson confirmed the visit of the Sistema chairman to India, without giving any details. He also said the company would go for a review petition of the Supreme Court (SC) verdict by the end of this month.

Sistema, along with the Russian government, holds 74 per cent in SSTL, whose pan-India licences were among the 122 cancelled by SC, on February 2, due to the 2G spectrum scam under A Raja’s regime. While Shyam group holds 24 per cent in the venture, the remaining two per cent is with the public.

Immediately after the SC order, Sistema had issued a statement pointing at its future course of action. “To safeguard its interests, Sistema and Sistema Shyam TeleServices Ltd (SSTL) will contest this order by pursuing all available legal remedies,” the company had said. Sistema was also exploring use of diplomatic channels to sort out the issue.

Within a year of launching the India operation, SSTL president and CEO Vsevolod Rozanov had told the Indian media that India offers opportunity in the telecom sector like none other. “India is one of the most Russia friendly markets,” he had said.

The company, which has pan-India 22 licences, has invested around Rs 14,000 crore in India so far. Its licences have been cancelled in 21 circles, excluding Rajasthan where it was present from before. It has 3,500 employees in India and 15 million subscribers.

Following the Supreme Court order, Etisalat DB and STel have announced closing their operations. The foreign majority partners in both the ventures—Dubai’s Etisalat and Bahrain’s Batelco—have said they are exiting the India market as their licences have been scrapped.

The SC order cancelled all 122 licences issued to telecom firms in 2008. The court has given four months' time to the Telecom Regulatory Authority of India to look into the matter and make recommendations for fresh auctions.

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