FIPB to take up Essar proposal
The FIPB had earlier deferred the proposal where Essar had sought the government agency's permission to increase the equity held through its foreign subsidiaries by 6.26 per cent to 22.04 per cent.
By PTI |
NEW DELHI: The Foreign Investment Promotion Board is scheduled to take up a proposal from Essar Group on November 10 for restructuring the foreign holdings in the telecom joint venture Hutchison Essar Ltd (HEL).
The FIPB had earlier deferred the proposal where Essar had sought the government agency's permission to increase the equity held through its foreign subsidiaries by 6.26 per cent to 22.04 per cent.
The Board had sought more clarification on the holding company and Essar has provided all the required information, according to official sources.
Currently, the total foreign holding (direct and indirect) in HEL is around 68 per cent.
FIPB is also scheduled to take on record the direct and indirect foreign investment in Spice Telecom, which operates in Punjab and a few other circles. Telecom Malaysia holds 49 per cent equity in the Modi group company.
If the new proposal is approved, foreign equity will go up to 74 per cent in HEL. The entire 22.04 per cent of foreign equity component within Essar's 33.01 per cent is being proposed to be routed through Essar Communications, a Mauritius-based offshore holding company of the Essar Group.
The move is being seen as an attempt by the Ruias-promoted Essar to keep off foreign operators and partners from acquiring more equity in Hutchison Essar. Currently, Indian telecom operators are permitted FDI up to 74 per cent.
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