Russian President may take up the issue in his March visit..

CANCELLATION OF 122 TELECOM LICENCES Russia to Take Up Sistema’s Cause with Indian Govt KALYAN PARBAT KOLKATA Russia is set to join Norway in mounting diplomatic pressure on India to protect foreign investors who have pumped in billions of dollars in telecom firms whose licences were scrapped by the Supreme Court last week. Norway’s minister for IT and Government Administration Rigmor Aasrud met telecom minister Kapil Sibal on Tuesday to express her government’s concern over Telenor’s . 14,000 crore investment in its Indian operation, Uninor. Russia’s communications minister Igor Shchyogolev is likely to follow suit and communicate concern over the cancellation of Sistema’s pan-India mobile permit by the apex court. Indian operations of Telenor, Sistema, Dubai’s Etisalat and Bahrain’s Batelco are among the 122 licences that have been scrapped. The Russian Federation, which owns a shade over 17% in Sistema Shyam, is likely to depute Shchyogolev to take up the matter with his Indian counterpart Kapil Sibal, a top official in the Russian embassy told ET. Shchyogolev is expected to drive home the point that Sistema did not break Indian laws and is being unfairly penalised. Sistema Shyam, a joint venture between Russian conglomerate Sistema and India’s Shyam group which retails mobile services under the MTS brand, is also likely to file a review petition in the Supreme Court. Its mobile permits in all regions except Rajasthan were quashed by the apex court. Russia, an official who did not wish to be named said, does not favour immediate international arbitration proceedings because it believes its long-term economic ties with India can help break the ice within the next two months. “Arbitration in any international court of law is both time consuming and costly. The outcome can also never be predicted,” the official quoted above said, adding that the meeting of the two ministers should yield a resolution. Sistema has not formally enlisted the support of the Russian government yet, the official said. If the Russian minister fails to make headway, the issue may figure during Russian Federation president Dmitry Medvedev’s upcoming meetings with the Indian leadership during his Delhi visit in late-March for the Bric summit. “President Medvedev’s intervention on the Sistema case may be sought only if all bilateral initiatives, including talks at the level of the communication ministers of both countries fail to resolve matters,” said a top official in the Russian embassy. Meanwhile, the Russian Federation is about to nominate a director on the Sistema Shyam board. “SSTL has decided for induction of a Russian Federation representative as director on its board. However, a formal nomination of the director is awaited from the Russian Federal agency,” said a Sistema Shyam spokesman. According to The Wall Street Journal, Sistema has said it will not lay off its India staff nor renegotiate deals with equipment vendors, about 50% of whom are Chinese. Like Telenor, it has reportedly indicated that its Indian JV, SSTL will bid for the 2G airwaves provided the base price is reasonable once the new auction rules are notified. Sistema and the Russian government collectively own nearly 74% in SSTL, while the Shyam group and others hold 24% and 2.8%, respectively.