The Indian authorities have apparently begun talks with overseas governments about transactions involving Indian mobile phone companies, as part of its investigation into the disputed 2008 2G licensing process. According to local publication The Economic Times, the country’s Enforcement Directorate has contacted the governments of the UAE, UK, Norway, Libya, Singapore, Isle of Man, Jersey, Mauritius, Russia and Cyprus, to discuss transactions related to Etisalat DB, Sistema Shyam, Unitech, S Tel, Idea Cellular, and other related companies. The aim is to discover whether companies conducted interlinked financial transactions to “camouflage the real beneficiaries of the spectrum scam,” following allegations that some of the companies given 2G spectrum were “fronts for investors in India and abroad.” On the domestic front, it was also reported that the Directorate has questioned an aide of the former telecom minister, Andimuthu Raja, with indications that other officials will come under scrutiny.
Bloomberg suggests that the continued uncertainty over the future of the new 2G players, including the possibility that these companies could have their licences cancelled, may play into the hands of more established rivals such as Bharti Airtel and Vodafone Essar. According to figures recently released by the Telecom Regulatory Authority of India, while BSNL had the greatest proportion of net subscriber additions during September 2010 (13.36 percent), this was followed closely by Uninor (12.71 percent), which outstripped more established rivals including Bharti Airtel, Reliance Communications and Vodafone Essar. Uninor is also the largest of the new entrants overall, with 1.64 percent market share, although this means it is still some way behind the smallest of the more established players, Aircel, which has a 6.76 percent share.