Cabinet nod to 74% FDI in telecom

The Cabinet today approved increasing foreign direct investment in telecommunications from 49 per cent to 74 per cent. Press Note 5 of 2005, which imposed stiff monitoring needs for telecom service providers, will be amended suitably.

Remote access to networks in India would be permitted from approved locations, Information and Broadcasting Minister PR Dasmunsi told reporters after a Cabinet meeting. Such access will only be allowed to equipment suppliers, manufacturers and affiliates and not for monitoring calls and content.

It will also be mandatory for operators to keep an audit trail of all remote access activities for six months, send a compliance report twice a year to the government and maintain a "mirror image" of all remote access information for online monitoring.

In the note for the approval of the Cabinet, the Department of Telecommunications (DoT) had also called for the setting up of a centralised lawful interception and monitoring system through which service providers can be monitored from a centralised location.

It was also decided that while the chief technical officer can be a foreigner vetted by security agencies, the chief officer dealing with network operation (network administrator) has to be a resident Indian national.

To strengthen the monitoring system further, vigilance technical monitoring cells of the DoT will be augmented and will have a director-level representative from security agencies. Apart from technical vigilance functions, these cells will also carry out activities on security aspects on the premises of the telecom service operators.

The DoT has proposed that it will extend the date of compliance with Press Note 5 (a note on FDI enhancement, which incorporates these security issues on remote access) for three months from April 2, 2007.

These conditions were formulated on the basis of the recommendations of a high-level group set up by the Cabinet last December.

The group was expected to suggest safeguards and examine security conditions on allowing remote access to the country's telecom network from foreign countries in the light of growing terrorism and increasing security concerns.

The national security advisor, the Cabinet secretary, and secretaries of home affairs, defence, telecom, and finance were members of this group.

In November 2005, the government issued Press Note 5, adding pre-conditions for enhancing FDI in telecom to 74 per cent. But telecom firms opposed various clauses in the pre-conditions, including the one not allowing remote access to their networks.