Norway warns India of 'political implications' if Telenor fails

Discussion in 'Foreign Relations' started by Yusuf, May 12, 2012.

  1. Yusuf

    Yusuf GUARDIAN Administrator

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    NEW DELHI: Telenor's $3 billion investment in India will have political implications.

    "Telenor is not just any company. 54% of the shares are owned by Norwegian people through state and thus, it has even further political implications that such a company will be harmed. If this investment fails, it will be probably the biggest loss a Norwegian company has in foreign investments ever. I think also it will be fair to say that it will influence the view of India as an investment country," Norwegian trade and industry minister, Trond Giske, told reporters.

    Giske is the representative of Norwegian government on the board of Telenor, which holds 67.25% stake in the telecom operator, Uninor. The balance is held by realty major Unitech.

    As many as 22 licences of Uninor were among the 122 licences cancelled by the Supreme Court on February 2, issued during the tenure of the then telecom minister A Raja. Uninor has been permitted to operate till September 7.

    Giske added that Norway and India share good bilateral relations and expressed hope that the issues will be resolved soon.

    "Bilateral relations between India and Norway are strong and they can handle any challenges. It might have effect on investors but government to government cooperation continues throughout all problems," Giske said.

    "This situation after the Supreme Court ruling with the withdrawal of licences and proposals from Trai for new auction, have created obstacles to our future engagement," he said.

    To continue its telecom operation, Telenor needs to acquire new licences and win spectrum through the upcoming auction. However, the company has expressed concern over the auction proposals of telecom regulator, Trai.

    The Trai had suggested a base price of Rs 3,622 crore for one megahertz (MHz) for pan-India spectrum. This is around 10 times higher than the price at which 2G licences bundled with 4.4 MHz spectrum were allocated in 2008 during Raja's tenure.

    According to Trai's recommendations, a minimum of 5 Mhz spectrum should be allotted, which means that pan-India airwaves in 1800 MHz band will cost Rs 18,100 crore.

    Telenor has objected to the high base price recommended by Trai along with network roll-out obligations and the quantum of spectrum proposed for auction.

    Giske said the Norwegian government fully respects the rights of Indian institutions' to take decisions but have "innocently harmed" the interests of Telenor and Uninor.

    "I think it is truly possible to strike a balance and find a common ground where both Supreme Court decisions are fully respected, revenues to the Indian government is secure and competition and good service are provided to customers through participation of Telenor," Giske said.

    Norway warns India of 'political implications' if Telenor fails - The Times of India
     
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  3. ashicjose

    ashicjose Regular Member

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    If Telenor and Uninor did anything wrong to obtain the 2G licences they have to take it.
     
  4. kaustav2001

    kaustav2001 Regular Member

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    Actually ...what I feel is that Telenor simply wanted to do good business in India & probably left the hassles of dealing with various govt. agencies/ officials to Unitech (quite naively or they probably chose to remain ignorant) , hoping that it would be more efficient without adequate scrutiny. I really don't think they had any idea (or probably chose to look the other way) of what Unitech did to obtain those licenses.
    Nevertheless ignorance/ oversight cannot really be an excuse & unfortunately they will take a (big) rap for that mistake. Sad part is that this isn't really going to help investor confidence in India (coming @ the same time as the retro-tax fiasco).
     
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  5. drkrn

    drkrn Senior Member Senior Member

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    Norway warning India of political consequences!!

    their words doesn't suit their international importance:)

    what kind of influence can they have on us.if they have done something wrong they have to enjoy the fruits of their misdeeds along with others.we can't have different rules for each and every person.
    idiots
     
  6. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    They are more pissed off about new spectrum prices than the SC ruling on Uninor. Indian telecom market is highly competitive and if they don't have money to buy new spectrum, they should leave. Why should GOI lose potential revenue by lowering the prices ?
     
  7. trackwhack

    trackwhack Tihar Jail Banned

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    meh, we are the third largest market in the world. companies will invest here
     
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  8. Daredevil

    Daredevil On Vacation! Administrator

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    Telenor is a victim of Indian corruption and mis-governance.
     
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  9. pmaitra

    pmaitra Moderator Moderator

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    Question is how did Telenor get those 22 licenses at one tenth the new pre-auction base price?

    They were about to benefit out of corruption that existed in the Indian system. They should not bother about competing again, since, all other companies will also be competing on an equal footing.
     
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  10. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    They are bitter because SC cancelled their licence. And now their market re-entry will be costly lowering the profit margins.

    Is Telenor more a sinner than sinned against?

    The Hindu : Business News : Is Telenor more a sinner than sinned against?
     
    Last edited: May 12, 2012
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  11. Godless-Kafir

    Godless-Kafir DFI Buddha Senior Member

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    Ya rite, threats dont go down well in GoI.
     
  12. nitesh

    nitesh Mob Control Manager Stars and Ambassadors

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    May be they will play spoil sport in NSG. Need to watch the moves
     
  13. Blackwater

    Blackwater Veteran Member Veteran Member

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    norway ki kya aukat ki hamse panga le.
     
  14. Adux

    Adux Senior Member Senior Member

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    To be honest, there could be a lot of truth in it. If anything Unitech should pay, not telnor. Our reputation should be reflected as investor friendly,
    After all Unitech is real estate , what else do you expect.
     
  15. drkrn

    drkrn Senior Member Senior Member

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    in Telugu there is a proverb
    "andite juttu andakapote kallu" literally means

    " trying to hold their hair on head , when not possible then hold their feet"

    now they are in first part
    then will come second
     
  16. drkrn

    drkrn Senior Member Senior Member

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    i really didn't like the wording the Norway govt used with us.our businessmen too had many problems in other countries.i think this year only Few of our people got arrested in China due to lack of knowledge about their rules..
    we didn't cry foul and got all of them back in a diplomatic manner.
    why does these people can't work that way. really bunch of idiots.
     
  17. sob

    sob Moderator Moderator

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    Telenor jumped in and bought the stake from Unitech at very low prices. They should have realised that such cheap valuations always have a hidden cost. In this case the people who did the due diligence for the company should be held accountable for the mess, or is it that the bosses at Telenor could not resist such a price that they were willing to overlook the irregularities in the tender.

    At the end of the day they are not not babes in the wood , due they are seasoned businessmen and if they loose money it is due to their own greed.
     
  18. Yusuf

    Yusuf GUARDIAN Administrator

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    There are two possbilities.

    1) Telenor knew everything and went ahead.
    2) Its Indian partner lied to it and screwed it.

    I can think of one thing for Telenor, khaya piya kuch nahi, glass phora baarana (didnt eat or drink anything, broke the glass and paid 12 annas for it)
     
  19. nitesh

    nitesh Mob Control Manager Stars and Ambassadors

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    There is no way Telenor doesn't know about the under table deals. They are just trying to show innocence, whereas they just outsourced the money laundering to an Indian subsidiary. This is common method adopted.
     
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  20. ice berg

    ice berg Senior Member Senior Member

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    It is common practise with under table deals in India. That is the way you do business there.

    You cant demand bribes and fair competition at the same time. Telenor was just caught in the middle of it.

    Blame the way you doing business in India. Telenor is after all a global company.
     
  21. nrj

    nrj Stars and Ambassadors Stars and Ambassadors

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    Telenor was engaged in malpractice. It submitted fraudulent documents to meet the criteria. This company failed in its business plan by loosing billions, thats pretty inefficient for a global company. Read up before you speak.
     
    Last edited: May 13, 2012

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