Telecom sector in 2014 is poised for a very positive growth, says Telecom Secretary
By insightVAS - Mon Dec 30, 7:16 pm
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The Department of Telecommunications is hoping to declare the new M&A guidelines next month. After a two year run-in with controversies, telecom sector now looks stable and seems back on its feet with initial investment proposal of over Rs 11,000 crore received in 2013.
While government is hopeful of announcing mergers and acquisitions guidelines in January and a new policy on machine-to-machine communications in first quarter of 2014, in 2013 it was able to implement new licensing regime of Unified Licences, open up telecom sector for foreign investment by raising FDI limit to 100 per cent from 74 per cent.
“We want to put mergers and acquisition guidelines in place before (spectrum) auction takes place. The year 2013 was basically a year which prepared this sector for huge growth in coming years. Telecom sector in 2014 is poised for a very positive growth riding on very good sentiments,” Telecom Secretary MF Farooqui told.
He also said that de-linking spectrum from telecom licences, introduction of Unified Licences and raising of foreign direct investment limit were key steps that government took for the sector during the year. In August, the government also approved 100 percent foreign direct investment (FDI) in the telecom sector, meeting a key demand of the fund-starved industry. Earlier, the FDI cap in the sector was at 74 percent. In April-September 2013 period FDI was only at Rs 197 crore.
Within three months of the decision on FDI, Vodafone Group approached Foreign Investment Promotion Board (FIPB) to increase its holding in Vodafone India Ltd (VIL) from 64.38 percent to 100 percent with an investment of Rs 10,141 crore.
“There is progress in the regulatory environment…there are reasonable expectations on the sector which I think is positive, so it’s sending a positive message about the country and about the desire to really push forward,” Vodafone Group’s Chief Executive Vittorio Colao said.
Vodafone’s investment is yet to be approved by the government.
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