December 28, 2006
BT to offer long distance services in India
Telecom will provide both domestic and internation services to corporations
Recommend ThisBT Group PLC has been issued letters of intent by the Indian government for the award of licenses for national and international long distance services from the country. The licenses, once awarded, will enable BT's joint venture company in India, BT Telecom India Pvt. Ltd., to provide services directly to multi-site corporate customers in the Indian market, BT said Thursday.
New rules of the Indian government, announced in November last year, allow companies with foreign ownership of up to 74 percent to offer telecommunications services in the country. Before this rule, foreign investment was limited to 49 percent, which was not seen as attractive enough by many multinational telecommunications companies.
BT applied earlier this year for the licenses with India's Department of Telecommunications (DoT) through BT Telecom India Pvt. Ltd., a joint venture between BT and Jubilant Enpro Pvt. Ltd., a company in Delhi engaged in the businesses of oil and gas, food and services.
Once the licenses are operational, BT will be able to offer both domestic and international managed services to corporate customers who have sites in India, the company said. BT will also be able to provide these companies with virtual private network-based (VPN) services using technologies such as ATM and internet protocol-based multi-protocol label switching (MPLS), it added. BT currently services offers managed services in India to its customers through a local partner.
AT&T Inc. has also obtained national and long distance services licenses earlier this year from the Indian government. The company has set up a joint venture in India to offer the services. AT&T owns 74 percent of the equity in the joint venture, AT&T Global Network Services India Pvt. Ltd. (AT&T India), with the balance held by an Indian partner.
The liberalization of foreign investment in telecommunications services in India, as well as a booming local market is attracting a number of multinational telecommunications service providers to invest in India. British mobile services operator Vodafone Group PLC is for example one of the bidders for a controlling stake in Indian mobile services operators, Hutchison Essar Ltd., which is majority owned by Hutchison Telecommunications International Ltd., a subsidiary of Hutchison Whampoa Ltd.
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