Govt cancels Videocon's LoI for Punjab circle

The government has cancelled the Letter of intent (LoI) of Datacom Solutions, a subsidiary of consumer durables manufacturer Videocon Industries, for the Punjab circle. However, this will not affect the group's operations that are being undertaken in the circle through another subsidiary, Dhoot Trading.

The Department of Telecommunications (DoT) has cancelled the LoI for "non-submission of compliance" (not complying with LoI norms), the Minister of State for IT and Communications Jyotiraditya Scindia informed the Rajya Sabha today.

"Datacom Solutions has not submitted compliance of LoI for Punjab service area and therefore the LoI has been cancelled," the minister said in a written statement.

Videocon Chairman and Managing Director confirmed this and said that the group has already received LoIs through a wholly owned subsidiary named Dhoot Trading. "We will commence operations immediately after the allocation of spectrum," he said.

Datacom Solutions has received spectrum for operations in Tamil Nadu and is expected to commence work soon. The company, which had earlier announced plans to invest Rs 6,000 crore for a GSM foray, is in advanced negotiations for partnering with the South African telecom group MTN.

Jyotiraditya Scindia informed Rajya Sabha that 121 LoIs and 120 Unified Access Services licences (UASL) were issued to over 16 private companies in January 2008.

As per UAS licence - the approval to provide telecom services in the country - the licensee has to commission applicable systems within a year from the effective date of the licence.

The government also issued five LOIs to ByCell Telecommunications in February even though UASLs are yet to be signed.