Bangalore: Union Communications and IT Minister Pramod Mahajan said on September 26, the issue of management control whether it should remain in Indian hands or not must be settled before foreign direct investment (FDI) cap in telecom sector is raised from 49 per cent to 74 per cent.

Inaugurating the second global telecom summit 2002 at Bangalore, Mahajan said he is in favour of increasing the upper limit and there is also consensus among the group of ministers concerned but the crucial issue is of management control.

He noted the moment company's equity goes beyond 50 per cent, it will have management control, adding, the question of raising the cap is not an "economic issue" but it's whether the management control should remain in Indian hands or not.

"We are a democracy. One need not speak the same language in cabinet. If everybody spoke the same language, there is no need for cabinet. There has to be consensus in cabinet (on the issue)," Mahajan said.

If India raised the FDI cap to 74 per cent, it would be among the very few nations in the world to do so, he told the participants of the two day event, organised by the federation of Indian chambers of commerce and industry (FICCI) with the theme 'destination India - the locomotive for growth'.

"We have to settle the management issue," he stressed.

Mahajan said, in the next few months, he would come out with a road map on revenue sharing arrangement, and indicated that government's revenue in this regard would come down. The government would study the international scenario in this context and go by the global average, he said.

On the spectrum allocation issue, Mahajan said the government would rationalise it and is keen to align it with global standards. He pointed out that earlier when spectrum management was not an issue at all it had been liberally allocated to departments such as Defence, Home and Railways.

Within the next few weeks, he would hold discussions with Defence Minister George Fernandes and would know how much spectrum that the department needs. "In the next three to six months, we will create more and more spectrum," he said.

Regarding the vexed issue of cost of interconnects, he strongly urged the telecom players to sit together and decide on an "ideal interconnect agreement". One would have to sign the agreement and there is no question of not inking the pact.

Referring to issues faced by the Indian telecom industry, he said the government and industry must come together instead of being at loggerheads and come out with a mutually agreed upon action plan in six months.

He assured foreign investors in telecom segment that there would be level playing field for everybody but one can't expect the government to "protect" them.

Noting that the global telecom market is currently in turmoil, the minister said the biggest challenge before the government now is how to insulate the domestic industry from the 'havocs' that are happening in the world.

India is the fastest growing telecom industry in the world at present but would it be able to sustain this, in view of the current global scenario, he asked.

Regarding the revenue sharing, Mahajan announced, that the players need to pay revenue to the government only after every quarter, discontinuing the present practice of doing so in advance.

PTI