Etisalat seeks advantage in India

Etisalat pays deposit of 4.27 billion rupees (Dh344.9 million) to participate in India's 3G wireless spectrum auction next month.

Etisalat has paid a deposit of 4.27 billion rupees (Dh344.9 million) to participate in India's 3G wireless spectrum auction next month as it seeks to dominate the country's burgeoning mobile market, the head of the company's Indian subsidiary said. The UAE's largest telecommunications operator would place bids on licences only in the regions it already operates in, said Majed al Musalli, the chief executive of Etisalat DB, the operator's Indian subsidiary.

The auction begins on April 9. "We are bidding right now for all the [regions] we are licensed for 2G," said Mr al Musalli. "Right now we're entering for the 15 areas." Etisalat has ambitions to become a significant player in the Indian mobile market as it prepares to expand its presence across the subcontinent region. Despite facing competition from 10 other mobile operators, Mohammed Omran, the chairman of Etisalat, has repeatedly stated the company planned to acquire other firms in the country.

Etisalat has 15 licences to operate in Indian cities including Kerala, Mumbai and Delhi following the purchase of Swan Telecom in December 2008 for US$900m (Dh3.3bn), which included a premium to control the company's management. The Indian spectrum auction is expected to return between 300bn and 400bn rupees to the Indian government. Other operators planning on participating in the auction include Aircel, Bharti Airtel, Idea, Reliance Telecom, S Tel, Tata Teleservices, Vodafone and Videocon.

To participate in the auction, Etisalat submitted 10 per cent of the reserve price the Indian government set aside for each region's licence as good faith money, said Mr al Musalli. Once the auction concludes, the winners will own a batch of the 2.1 gigahertz spectrum, a frequency capable of performing high-speed mobile services for devices such as Apple's iPhone and Google's Nexus One phone. Etisalat has decided to not participate in India's broadband wireless access auction, a separate licence sale which is necessary for rolling out Wimax (wireless broadband) services, according to the Indian government.

In January, Etisalat announced plans to acquire an additional 5 per cent of Etisalat DB from Genex Exim Ventures.