The Indian government has rejected a proposal from UAE incumbent Etisalat to increase its stake in its local venture Etisalat DB Telecom, according to media reports.
The refusal came from the Foreign Investment Promotion Board, a governmental agency…
The Indian government has rejected a proposal from UAE incumbent Etisalat to increase its stake in its local venture Etisalat DB Telecom, according to media reports.
The refusal came from the Foreign Investment Promotion Board, a governmental agency responsible for decisions on foreign direct investment, which itself did not cite any specific reasons, Reuters reports.
The newswire quotes Etisalat DB’s vice chairman Shahid Balwa as saying that the application had been rejected due to technical reasons and that the company would reapply soon with the required documents.
Etisalat has for several months tried to raise its stake in the new entrant from the current 45%.
Last June, its proposal was deferred for the third time after the Ministry of Home Affairs raised security concerns, including Etisalat’s relationship with Chinese vendor Huawei.
However, few in the market believe Etisalat is seriously interested in DB Telecom, saying that it is much more likely to look to take a chunk of an established, homegrown player that is likely to survive consolidation in the overheated market. This is despite denials that the operator is in formal talks with Idea Cellular, and efforts to play down its interest in Reliance.
Etisalat did not return phone calls and emails asking about further information.
