The government has formed a team with representatives from the department of telecommunications (DoT), the ministry of external affairs and the department of economic affairs to initiate dialogue with Russian conglomerate Sistema JSFC, which has served legal notice to the government following licence cancellation of its joint venture firm, Sistema Shyam Teleservices Ltd (SSTL).
In its recent meeting, the inter-ministerial group (IMG), formed by DoT for handling legal notices under the Bilateral Investment Promotion and Protection Agreement (Bipa), has decided a group be formed for discussion with Sistema without foreclosure of any legal options.
Bipa is an agreement between two countries for the reciprocal encouragement, promotion and protection of investments in each other's territories.
The IMG will also take up the case of other foreign firms that have served notices to the government. Besides Sistema, other telecom firms had also served notices to the government under Bipa. Telenor Asia has served a notice under an agreement with Singapore. The investors in Loop Telecom, Capital Global Ltd and Kaif Investment served notices under the Bipa with Mauritius. Vodafone International Holdings served a notice to the government under the Bipa with the Netherlands.
The move to initiate dialogue with Sistema is triggered by the fact that the six-month deadline given by the Russian firm for resolving its investment dispute in India is nearing.
Earlier this year, it had served a notice to the Centre, invoking the right to protect its investment under Bipa with Russia, after the apex court cancelled 122 telecom licences of several operators including SSTL on February 2 in the second generation (2G) spectrum allocation case.
Sistema has said it reserves the right to begin proceedings against India in an international tribunal if the dispute was not settled amicably by August 28. The Russian government has 17.14 per cent stake in SSTL, a joint venture between Sistema and India's Shyam Group. The pan-India CDMA services provider has around 15 million subscribers.
DoT is already deciding on a team of legal experts, from India and abroad, to look into the notice served by Sistema.
Earlier, DoT had sought legal opinion from the attorney general, the nation’s highest law officer, on whether the Supreme Court order could be challenged under the bilateral investment protection treaties India has signed with various countries.