Concerned over the fate of Sistema in India,Russia has asked New Delhi to amend the bilateral investment promotion and protection agreement (BIPA) between the two countries.
This has been conveyed at high-level interactions between India and Russia in the recent weeks.
During the interactions,sources said,the issue of promotion of new investments and protection of earlier investments made has been discussed.
The Russian side,according to South Block sources,has specifically voiced concerns regarding large-scale investments made by Russian firms in the telecom sector.
In this context,the Russian side has suggested amending the Bilateral Investment Promotion & Protection Agreement of 1994, a government source said.
Sistema had ventured into Indian telecom space with its joint venture Sistema Shyam TeleService (SSTL) in 2008.
However,with the Supreme Court cancelling 122 licenses for mobile networks issued during A Rajas tenure as telecom minister,SSTL lost 21 out of 22 licences in the February 2012 order.
After the SC order,foreign companies,including Sistema,invoked various clauses of BIPA. The Russian proposal to amend BIPA,sources said,has been forwarded by the ministry of external affairs (MEA) to the finance ministry for a review.
Confirming the development,senior counselor at the Russian embassy in New Delhi,Sergey V Karmalito said that they want the agreement to be more effective and workable,so that there is a push for more Russian investments into India. The agreement has never been implemented so far. So we want it to effective and workable, he said.
Russia has been very upset since the two countries had not found a solution to the Russian telecom giant Sistemas over $3 billion investment in India. The Russians signed the bilateral investment protection treaty in 1994 and it was the second country after the UK to have signed this agreement. Since then,more than 80 countries have signed agreements with India.
Russia wants the 19-year-old agreement to be adequately changed to include unambiguous safeguards to protect large scale Russian investments,irrespective of the sector.