Before his arrest on Tuesday, the vice chairman of Etisalat's Indian subsidiary was lionised in India's business circles for his rags-to-riches story.
Shahid Balwa, widely regarded as a self-made billionaire tycoon, is a school dropout, unlike many of his peers who hold degrees from Ivy League business schools. Last year, Forbes magazine counted him among India's 50 richest people, with a personal net worth exceeding US$1 billion (Dh3.67bn). Mr Balwa, 36, who made his fortune in property rose at a young age to become the managing director of the Dynamix Balwas (DB) group in Mumbai, India's third-largest property agent.
But he is best known for pulling off the celebrated joint venture deal in 2008 between the DB Group-promoted Swan Telecom and Etisalat. The venture, known as Etisalat DB, was hailed as Etisalat's official entry into India, the world's second-fastest growing telecommunications market after China.
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Yesterday, soon after Mr Balwa's arrest for alleged involvement in a widening spectrum licensing scandal, Etisalat said: "Etisalat has an impeccable record of performance and its antecedents and reputation have never been questioned."
The company said it acquired a 45 per cent stake in Swan Telecom after the licensing bidding process.
"Etisalat is a subsequent external investor, who entered the Indian market bringing its international expertise and resources, which purchased its stake in the company on the bona fide belief that the licences have been validly granted," it said. India's central bureau of investigation claims Swan, promoted by Mr Balwa, minted profits from the licences and the joint venture at the expense of the Indian government - and Etisalat.
It says Swan bought second-generation (2G) spectrum licences for 13 zones for 15.37bn rupees (Dh1.24bn), well below the market rate, and sold 45 per cent of its shares within months to Etisalat for about 47.3bn rupees.
Andimuthu Raja, the telecoms minister at the time of the sale, was arrested this month for allegedly twisting the licensing procedure to favour Etisalat DB and other telecoms companies.
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Mr Balwa denies any wrongdoing. In an emotional outburst in an Indian court yesterday, he claimed he was being "singled out" and harassed. DB Realty says he has been "wrongly implicated".
"We reiterate that neither Mr Balwa nor any person or entity forming part of the DB Group has done anything inappropriate or illegal. Mr Balwa will be strongly contesting the proceedings," the company said.
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