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India contacts foreign governments as 2G investigation gets underway

India’s government has begun investigations into the 2008 issue of 2G licences, a process which has been under scrutiny since the scandal which resulted in the resignation of telecoms minister Andimuthu Raja.

The country’s Enforcement Directorate has reported made contact with the governments of several countries as a means of investigating transactions connected with numerous Indian firms, among them Etisalat DB, Unitech, Idea Cellular, S Tel, and Sistema Shyam. The countries that have thus far been tapped include Norway, the UAE, Russia, the UK, Singapore, Cyprus and Libya.

The stated goal of the investigation is to discover “the real beneficiaries of the spectrum scam” and bring them to justice; there have been claims that many of the 2G licensees were in fact “fronts for investors in India and abroad.”

Meanwhile, within the country’s borders, aides and officials at the Department of Telecoms have been questioned concerning the licensing process, in what looks to be the beginning of a thorough scrutinising of the sector.

Many of the companies that purchased licences during the 2008 process stand to have their licences cancelled; however, there are concerns that this could further bolster established players in the market by reducing competition.

Of the market newcomers that purchased 2G licences, Uninor has the greatest market share with 1.64%. Although this places it significantly behind even the smallest established operator (Aircel, with 6.76%), it outperformed several established rivals in terms of new subscribers in September 2010, claiming 12.71% of all additions in this period.

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