New entrant telco S Tel , has been asked by DoT to stop service in all of the three circles, Himachal Pradesh, Bihar and Orissa it has been operating from December last year,  in the interest of national security reports Business Line. We find it surprising that the Government realized that S Tel allegedly is a security threat after two months of operational launch, and a couple of years after it bagged UAS License for 6 circles, on January 25, 2008.  According to TRAI, S Tel had 506,179 wireless connection in all its three circles at the end of January 2010, so what of their subscribers?

A source close to the company told MediaNama that all security clearance of STel has been withdrawn by DoT. All hasn’t been hunky-dory between S Tel and the DoT in the past:

STel One Up In Legal Battle With DoT  Over Spectrum Allocation

Stel had filed a writ petition in 2008 against DoT advancing the cut-off date to give license from October 1 to September 25, 2007, which resulted in STel only getting license for 6 circles. A single Judge bench of the Delhi High Court had ruled in favor of S Tel on the 1st of July 2009, as did a division bench on the 24th of November last year. Ahearing in the Supreme Court is scheduled to take place.  And what exactly is this security threat?

Possible Security Threats

According to media reports DoT  has not specified any particular security threats in their notice to the telecom operator, however there have been speculations that the following could be the  possibilities:

– STel’s network equipment is manufactured by China’s ZTE may not have got security clearance. In December last year the Indian government had asked BSNL not to purchase telecom equipment to be installed in sensitive border from China.

– The Home Ministry might have objected to Bahrain based Batelco’s investment in the venture. S Tel is a joint venture between Siva Group (formerly Sterling Infotech Group) and BMIC Limited, a subsidiary of Bahrain Telecommunications Company (Batelco). Batelco had acquired 49 percent in Stel for $225 million in January 2009. If this was an issue, then why was Batelco allowed to invest in S Tel?


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