News

    Foreign Investors Jolted by India's Regulatory Changes

    A man speaks on a mobile phone in front of a billboard of Uninor at a market in Ahmedabad, February 6, 2012.  Telenor's joint venture with Unitech, which operates under the Uninor brand, has been among the most aggressive of India's newer telecoms compani
    A man speaks on a mobile phone in front of a billboard of Uninor at a market in Ahmedabad, February 6, 2012. Telenor's joint venture with Unitech, which operates under the Uninor brand, has been among the most aggressive of India's newer telecoms compani

    Norway’s telecommunication company Telenor says it will seek compensation from the Indian government for canceling its licenses to provide mobile-phone services in India.  Its threat of legal action comes nearly two months after India's Supreme Court canceled all licenses of this type given in 2008. The Norwegian company was one of several companies affected by the order.

    The decision followed allegations the license sale was rigged and had cost the government nearly $40 billion in lost revenue.

    Telenor will have to stop its operations in India by June 2 because the government says it could take more than a year to issue new licenses.  The company says it intends to seek compensation for all investments, guarantees, and damages for its $ 2.7-billion investment.

    Telenor purchased the licenses from its local partner after India opened its telecommunication sector to foreign investors.  

    Another company whose licenses were canceled, Russian conglomerate, Sistema, has also threatened to seek international arbitration if the dispute is not settled by August.

    Concerns have been expressed that such disputes could discourage foreign investors from India.  

    The director of the Research and Information Systems for Developing Countries in New Delhi, Biswajit Dhar, says India needs to reassure investors the cancellation of licenses was a one-time case.  

    "There has to be coherent policies which tell investors that India is a destination that is worth looking at and there are longer-term prospects," said Dhar. "We have to articulate very clearly that these are the objectives ... there is going to be more business for the foreign investors who come and repose confidence in the country.  So there is no point in looking at the immediate setback, but one has to focus on the longer-term advantages that India offers."

    The cancellation of telecom licenses is not the only jolt to investor confidence.  Foreign investors are also unnerved by two recent tax proposals.

    The government proposes to tax retroactively transactions between overseas companies for transfer of an Indian asset.  This would apply to transactions going back to 1962.  Goldman Sachs Chief Executive Lloyd Blankfein has said it is “unbelievable” that India would introduce such a tax law.   

    And Asian investment banks have expressed concerns regarding a proposal to tax investments by foreigners in Indian capital markets.

    Business leaders say that uncertainty about the level of taxation will discourage foreign investors.

    India’s growth has slackened in recent months and any slowdown in foreign investment could further stress its economy.   

    This forum has been closed.
    Comments
         
    There are no comments in this forum. Be first and add one

    Featured Videos

    Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
    Displaced By War, Syrian Artist Finds Inspiration Abroadi
    X
    May 02, 2016 1:36 PM
    Saudi-born Syrian painter Mohammad Zaza is among the millions who fled their home for an uncertain future after Syria's civil war broke out. Since fleeing Syria, Zaza has lived in Lebanon, Egypt, Jordan and now Turkey where his latest exhibition, “Earth is Blue like an Orange,” opened in Istanbul. He spoke with VOA about how being displaced by the Syrian civil war has affected the country's artists.
    Video

    Video Displaced By War, Syrian Artist Finds Inspiration Abroad

    Saudi-born Syrian painter Mohammad Zaza is among the millions who fled their home for an uncertain future after Syria's civil war broke out. Since fleeing Syria, Zaza has lived in Lebanon, Egypt, Jordan and now Turkey where his latest exhibition, “Earth is Blue like an Orange,” opened in Istanbul. He spoke with VOA about how being displaced by the Syrian civil war has affected the country's artists.
    Video

    Video Ethiopia’s Drought Takes Toll on Children

    Ethiopia is dealing with its worst drought in decades, thanks to El Nino weather patterns. An estimated 10 million people urgently need food aid. Six million of them are children, whose development may be compromised without sufficient help, Marthe van der Wolf reports for VOA from the Metahara district.
    Video

    Video Little Havana - a Slice of Cuban Culture in Florida

    Hispanic culture permeates everything in Miami’s Little Havana area: elderly men playing dominoes as they discuss politics, cigar rollers deep at work, or Cuban exiles talking with presidential candidates at a Cuban coffee window. With the recent rapprochement between Cuba and United States, one can only expect stronger ties between South Florida and Cuba.
    Video

    Video California Republicans Weigh Presidential Choices Amid Protests

    Republican presidential candidates have been wooing local party leaders in California, a state that could be decisive in selecting the party's nominee for U.S. president. VOA's Mike O’Sullivan reports delegates to the California party convention have been evaluating choices, while front-runner Donald Trump drew hundreds of raucous protesters Friday.
    Video

    Video Kurdish Football Team Helps War-Torn City Cope

    With the conflict still raging across much of Turkey’s predominantly Kurdish southeast, between the rebel PKK and the Turkish state, many Kurds are trying to escape the turmoil by focusing on the success of their football team Amedspor in Diyarbakir. The club is increasingly becoming a symbol for Kurds, not only in Diyarbakir but beyond. Dorian Jones reports from southeast Turkey.
    Video

    Video ‘The Lights of Africa’ - Through the Eyes of 54 Artists

    An exhibition bringing together the work of 54 African artists, one from each country, is touring the continent after debuting at COP21 in Paris. Called "Lumières d'Afrique," the show centers on access to electricity and, more figuratively, ideas that enlighten. Emilie Iob reports from Abidjan, the exhibition's first stop.
    Video

    Video Pakistani School Helps Slum Kids

    Master Mohammad Ayub runs a makeshift school in a public park in Islamabad. Thousands of poor children have benefited from his services over the years, but, as VOA's Ayesha Tanzeem reports, roughly 25 million school-age youths don't get an education in Pakistan.
    Video

    Video Florida’s Weeki Wachee ‘Mermaids’ Make a Splash

    Since 1947, ‘mermaids’ have fascinated tourists at central Florida’s Weeki Wachee Springs State Park with their fluid movements and synchronized ballet. Performing underwater has its challenges, including cold temperatures and a steady current, as VOA’s Lin Yang and Joseph Mok report.
    Video

    Video Somali, African Union Forces Face Resurgent Al-Shabab

    The Islamic State terror group claimed its first attack in Somalia earlier this week, though the claim has not been verified by forces on the ground. Meanwhile, al-Shabab militants have stepped up their attacks as Somalia prepares for elections later this year. Henry Ridgwell reports there are growing frustrations among Somalia’s Western backers over the country’s slow progress in forming its own armed forces to establish security after 25 years of chaos.
    Video

    Video Documentary Tells Tale of Chernobyl Returnees

    Ukraine this week is marking the 30th anniversary of the world's worst nuclear accident, at the Chernobyl nuclear power plant. Soviet officials at first said little about the accident, but later evacuated a 2,600-square-kilometer "exclusion zone." Some people, though, came back. American directors Holly Morris and Anne Bogart created a documentary about this faithful and brave community. VOA's Tetiana Kharchenko reports from New York on "The Babushkas of Chernobyl." Carol Pearson narrates.
    Video

    Video Nigerians Feel Bite of Buhari Economic Policy

    Despite the global drop in the price of oil, Nigerian President Muhammadu Buhari has refused to allow the country's currency to devalue, leading to a shortage of foreign exchange. Chris Stein reports from Lagos businessmen and consumers are feeling the impact as the country deals with a severe fuel shortage.
    Video

    Video  Return to the Wild

    There’s a growing trend in the United States to let old or underused golf courses revert back to nature. But as Erika Celeste reports from one parcel in Grafton, Ohio, converting 39 hectares of land back to green space is a lot more complicated than just not mowing the fairway.

    Special Report

    Adrift The Invisible African Diaspora