US senators oppose VSNL’s fibre optic deal

Himalayan News Service

New York, April 12:

Three US senators have described India’s Videsh Sanchar Nigam Ltd (VSNL) as a company “demonstrably hostile” to US military and commercial interests and called for expanded security hearing on its proposed $130 million takeover of Tyco International Ltd’s global undersea fibre network. Republican Senators Jon Kyl of Arizona, Ted Stevens of Alaska and Jeff Sessions of Alabama have written to Energy Secretary John Snow opposing the proposed takeover. They have called for a full investigation by the Committee on Foreign Investment in the US. The deal for the transaction involving Tyco Global Network (TGN) was announced last November by Tyco and VSNL, which is controlled by the Tata Group, with the Indian government owning 26 per cent stake.

“TGN is a asset of incalculable value to the US security and commercial interest. It is an immense, international network offering massive amounts of high-quality fibre optic bandwidth,” the senators wrote. “This transaction gives the Indian government control over a significant portion of the world’s submarine cable network (including more than 80 per cent of total trans-Pacific undersea capacity) and over key strategic submarine cable landing stations in US,” they wrote. They noted that in the early 1990s VSNL refused to allow another undersea cable network to establish landing point on the island of Diego Garcia, which has a US military base.

The senators’ letter comes days after a US corporation filed a petition with the Federal Communications Commission (FCC) asking it to reject the transaction on the ground of homeland security concerns. In its Petition to Deny before the FCC, Crest Communications Corp’s vice-president Brian Roussell, said, “This sale of the last remaining global undersea cable network under US ownership and control represents a direct threat to our nation’s security.” “By approving this sale, the FCC would be giving up US control of this vital international communications artery, which accounts for over 85 per cent of the total trans-Pacific submarine cable capacity. We would lose our ability to ensure safe, and secure telecommunications services that are essential to the US military.”