DoT refuses Qualcomm broadband licence, jeopardises $1-bn investment

US telecom major and chip-maker Qualcomm Inc said on Thursday that its application for Broadband Wireless Access (BWA) licences for providing internet services in four circles in India had been rejected by the Department of Telecommunications (DoT).

Qualcomm, which paid $1 billion after acquiring the licence for the four circles, stands to lose the amount that it had forked out last year.

The company won the auction in June 2010 and paid $1 billion a few days later. It had won the BWA licences for Delhi, Mumbai, Haryana and Kerala circles.

The DoT rejected its application on some procedural grounds. ''In fact, the application process was fully complied with, and we will continue to work with the Indian authorities to resolve this matter,'' the company said in a statement on Thursday.

A few days ago the company had dashed off a reminder to the DoT, seeking the licences to roll-out its services. ''Our investment in India of such a large sum was made to facilitate the provision of wireless broadband in India as quickly as possible,'' the company wrote to the department. ''It is our understanding that our investment was welcomed, as the Government of India wishes to attract foreign direct investment, like ours, to facilitate the rapid roll-out of broadband as widely as possible throughout India. Now, however, it appears that our investment has been put in jeopardy and on grounds that we find to be baseless.''

The dilly-dallying on the part of the DoT has been slammed by the telecommunications industry. ''This sends out a very wrong signal to global investors,'' pointed out Rajan Mathews, director-general, Cellular Operators Association of India (COAI).  ''The DoT should act as a facilitator to investments from a company which has invested a billion dollars and won spectrum in an open transparent manner.''