India to penalize not-working telecom license holders

The Indian government said it is working on a plan to penalize companies that haven't started telecommunications services after getting licenses back in January 2008. License holders will be required to pay "liquidated damages" to the Department of Telecommunications for not meeting service launch obligations.

A number of firms received licenses in January 2008 to provide mobile phone services. Under the terms of the license, companies were required to start services within 12 months of receiving a license, but anywhere from five to six companies that did not may face financial penalties.

The extent of foreign investment in some of the license holders is complicating matters, with offshore companies holding anywhere from 26 to 60 percent of the entities in question.

For more:
- Read the Dow Jones piece through the Wall Street JournalPost.

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