The Union Cabinet has decided to open the telecom sector more to get higher FDI. Earlier, the government had accepted the proposal to raise the FDI limit in telecom to 49 per cent. Now, the cabinet finally approved the proposal to raise the limit further to 74 per cent with a new set of conditions.

However, government had approved the proposal to raise the FDI limit to 74 percent in November 2005 but the government could not complete the guidelines on remote access and the final nod for the approval got delayed by more than one year. In the past two years, the Cabinet gave several extensions to the sector to comply with the norms.

With the new conditions, remote access of networks will be allowed from approved locations only and the access facility will be available only for equipment suppliers, manufacturers and affiliates.

Now, so many foreign companies would enter in the Indian telecom market. The government has issued the guidelines for higher FDI as well as certain safeguards too. On the issue of remote access, the government has decided to put five safeguards in the guidelines:

# Remote access to networks in India will be allowed only from approved locations.

# Remote access will only be offered to equipment suppliers, manufacturers and affiliates.

# Remote access cannot be used for monitoring content.

# A mirror image of remote access information must be made available online in India to the security agencies.

# A complete audit trail of remote access activities must be maintained for six months.

The deadline for telecom firms to meet the current norms on FDI expires on April 2.On the other hand; the cabinet did not say anything on the guidelines that were believed to have been cleared some months back.

According to those guidelines, the government has probably allowed foreigners officials as CEOs, CFOs and CTOs in telecom companies working in India.

Read

Image Source: gettyimages