DoT asks S Tel to stop services on security concerns

S Tel, a joint venture between Chennai-based Siva Group and Bahrain Telecom (Batelco), has been directed to immediately stop its mobile services in Himachal Pradesh, Bihar and Orissa, citing national security concerns.

The company has licences for Himachal Pradesh, Orissa, Bihar, Jharkhand, Jammu and Kashmir and Assam circles but is operational only in the three circles. The company has a user base of over eight lakh. Sources in the Department of Telecom said the company has been asked to stop services in all these three states.

Batelco, which has 42.7 per cent stake in S Tel, has entered into a partnership with Bahrain-based Islamic investment bank Global Banking Corporation (GBC), which in turn will acquire 11 per cent stake in S Tel for $50 million. GBC buying 11 per cent in S Tel will indirectly raise Batelco's stake in S Stel by 6.3 per cent to 49 per cent.

When contacted, the company confirmed of having received an order asking to stop "voice and SMS services" till further clarification.

"We have received the letter. We are also surprised by this kind of letter especially after the government gave us permission on December 11 and 21 last year to launch services," P Swaminathan, Director, Siva Group, told PTI.

"We are trying to ascertain specific facts which are behind the national security concerns," he said.

S Tel is sharing the whole infrastructure with existing operators and has decided not to put up any tower of its own.