Government likely to provide telecom companies time to comply with the requirement for 26 per cent resident Indian hold ing as part of the exercise to ease the rules relating to FDI in telecom.

The government is likely to provide telecom companies time to comply with the requirement for 26 per cent resident Indian holding as part of the exercise to ease the rules relating to foreign direct investment (FDI) in telecom. The holding of Indian public sector banks will most likely not be included in the overall 74 per cent foreign investment cap and is also likely to be treated as resident holding. The detailed rules are being prepared by the Department of Telecommunications (DoT) and the FIPB. The expected easing of norms follows representations from various telecom companies. In February, the Union Cabinet had cleared a proposal to raise the foreign investment cap in the telecom sector from 49 per cent to 74 per cent but stringent safeguards had been proposed following concerns expressed by security agencies and the left parties.