Etisalat to close India operations after court cancels licences
NEW DELHI, Feb 23, 2012 (dpa - McClatchy-Tribune Information Services via COMTEX) --
Abu Dhabi-based telecoms firm Etisalat Co said Thursday it was closing its India operations following a recent court order cancelling its licences.
The Supreme Court this month scrapped 122 licences issued under allegedly fraudulent government sales procedures in 2008, which deprived the national exchequer of up to 40 billion dollars, government auditors said.
The licences are to remain valid until a fresh auction, to be held within four months, but the companies would then be required to make fresh bids.
A statement sent by the company via email said the court decision had "removed" Etisalat's ability to operate from June 2, 2012. The company had commenced its network shutdown in India, spokeswoman Ritika Verma confirmed Thursday.
It was withdrawing from the Indian market to protect its stakeholders and avoid further costs at a time when the Indian telecoms sector was facing change and uncertainty, the company said.
On February 9, Etisalat wrote off about 820 million dollars from its Indian unit Etisalat DB. The affiliate had a total of 15 licences across the country and around 1.6 million customers.
Etisalat is the second company, after Bahrain Telecom, to exit India after the court order. Norway's Telenor ASA and Japan's NTT Docomo have also been affected by the court order but have not talked about pulling out of the country.
India is one of the world's largest and fastest-growing markets for mobile telephones with 894 million subscribers. The court order came as a major setback for the government of Prime Minister Manmohan Singh, which has been hit by a slew of corruption scandals.
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