Hutch Essar buy under discussion:Rel Comm

However, as is customary, there is no certainty either on the completion, or the timing, of any such proposal.

The cornerstone of the Company's strategy for future growth will always be sustainable value creation for all stakeholders of the Company.

Reliance Communications Ltd on December 28, 2006 has announced significant plans to expand FLAG Telecom's global optic fibre network. Over the next 36 months FLAG Telecom will build the world's largest IP network over submarine cable systems. Termed - FLAG Next Generation (NGN), the project will cater to the fast growing telecom needs of over 5 billion customers across the globe (i.e. 5 out of 6 people in the world).

FLAG Telecom Ltd, currently the worlds largest private undersea cable system, would invest $ 1.5 billion (nearly Rs 7000 crore) in laying 50,000 additional kms of undersea optic fibre cable which would ultimately cover 60 countries, contributing 90% of Global GDP. On completion FLAG Global Network would span over 1,15,000 kms by December 2009 taking the total optic fibre assets of Reliance Communications Group to over 2,30,000 kms.

"We live in a world where there is too much of bandwidh for some, title for others and none for many - there is unequal access to bandwidth in and across countries, continents and communities", said Mr Anil Dhirubhai Ambani, Chairman - of the Company. "FLAG NGN will democratize digital access and give nearly everyone in the world the opportunity to be part of a massive lifestyle change which might have surprise even a visionary as big as Dhirubhai...", he added.

FLAG NGN will comprise of the following 4 systems:

FLAG NGN System 1 : Asia "" India, Malaysia, Singapore, Indonesia, Vietnam, Philippines, Brunei, Honk Kong.

FLAG NGN System 2 : Africa - Kenya, Mozambique, Republic of South Africa, Tanzania, Madagascar, Mauritius.

FLAG NGN System 3 : Mediterranean "" Greece, Cyprus, Turkey, Malta, Libya, Lebanon.

FLAG NGN System 4 : Trans""Pacific "" US West Coast, Japan, China and Hong Kong.

FLAG Global Network would have the capability to carry 2.5 billion simultaneous voice calls, 300 million simultaneous webchats, 52 million simultaneous Video Chats and enabling 20 mn students in educations institutions of India to offer e-learning simultaneously.

FLAG Telecom's clientele includes prestigious names like NTT, AT&T, Verizon, British Telecom, Orascom, QTel, Vodafone, Hutch, AOL, Google, Yahoo, Microsoft, Citigroup, HSBC, UBS, Deutsche Bank, Morgan Stanley to name a few. The Company recently launched FALCON Cable system connecting 12 countries in the Middle East to rest of the World. The Cable system was completed in 80% of the envisaged project cost four months ahead of schedule has already resulted in capacity sales of over $450 mn of FLAG Global Network since January 2006.