ALCATEL SATELLITE VENTURE GETS NOD; LIBERAL POLICY PROPOSED

The Foreign Investments Promotion Board (FIPB) cleared a satellite project in which the foreign equity participation is 49% last week. The satellite project - estimated to cost Rs 11,000 million - has been proposed by Delhi-based Hindustan Technologies Ltd (HTL) in partnership with French telecom giant Alcatel and Singapore-based firm Skysat Holdings. The satellite is to be used for telecom and multimedia services. HTL has to still get clearances from the Cabinet Committee on Foreign Investment, the industry ministry, and the department of space and telecom before it can go ahead with the satellite project.

This is one of the first satellite ventures to get the FIPB nod after the Indian government had announced a cap of 49% on foreign equity. The department of space has recently proposed that even 100% foreign ownership in satellite projects should be permitted. The recommendation is part of a policy paper submitted to the government. The paper says foreign companies should be allowed to build and launch satellites - which will be designated as Indian for frequency allocation from the International Telecom Union (ITU) -- from India soil. The policy is expected to get the go-ahead by early 1999. It further states that foreign or private Indian firms can form a consortium with the government-owned Indian Space Research Organization (Isro) to build and launch satellites.

Isro, which has built and launched some of the Insat series of satellites, has recently added another launch pad at Sriharikota in Andhra Pradesh to cater to launch demand when it crops up.