NSA norms on 'undesirable' investment in offing

Concerned over the presence of Egyptian operator Orascom' on the board of an Indian cellular JV, National Security Council (NSA) is understood to be working out guidelines to prohibit investments from "undesirable quarters".

NSA is seized of the Orascom issue. They are working out detailed norms as per which investment from undesirable quarters is prohibited, Department of Telecom officials said. NSA is now the sole deciding authority in security issues on FDI.

In the guidelines of FDI hike in telecom to 74% from 49%, it has been mentioned that, "While approving the investment proposals, FIPB shall take note that investment is not coming from unfriendly countries".

DoT and the Department of Economic Affairs see the move as a transfer of shareholding abroad, which has nothing to do with India, therefore there is no need to extra scrutinise it. But NSA thinks otherwise, which is why it already has taken up the matter on its own some time ago on the 'security' issue.

Egyptian telecom company Orascom has an indirect 10% stake in Hutch Essar by virtue of Orascom's 19.3% equity in Hutch Telecom International (HTIL).

Earlier, National Security Advisor M K Narayanan wrote a letter to the DoT saying that Orascom's acquisition of 19.3% equity in Hutch International is a threat to national security as Orascom is a dominant mobile operator in Pakistan and Bangladesh.