India threatens to revoke 2G licenses

India's new telecom minister Kapil Sibal has called on companies holding 85 disputed 2G licenses to justify ownership or have the spectrum revoked.
Show cause notices issued by the Department of Telecom (DoT) will give license owners 60 days to justify their eligibility, Sibal revealed at a press conference Monday, warning that those who fail to do so risk hefty fines or losing their license altogether, the Business Standard reported.
The owners acquired their licenses through a controversial spectrum allocation in 2008, overseen by Sibal's predecessor A Raja.
Raja, who was forced to resign earlier this month, is accused of costing the government up to up to 1.76 trillion Rupees (€29.2 billion) by allotting the frequencies directly instead of through an auction.
The department is also alleged to have allowed participants to submit doctored or falsified applications.
Audits and reports into the spectrum scandal suggest Unitech Wireless (now Uninor), Loop Telecom, Swan Telecom (now Etisalat DB), S-Tel and Allianz Infratech could receive notices.
Sibal has also called for a probe into allegations the then Swan Telecom was acting as a front company for cellco Reliance Communications – a claim the company denies.
The department will also send notices to 119 licensees for failing to meet rollout obligations and may revoke licenses on these grounds. DoT rules call for spectrum winners to rollout services in 90% of metro areas in a circle within 12 months of receiving licenses.
Sibal is under pressure to take a hard line in reaction to the 2G spectrum scandal to restore the damaged reputation of his department.