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Enron to foray into telecom in India

Neena Haridas in New Delhi

US multinational Enron today announced its plans to foray into the fast growing telecom sector in India and said that the company would develop the fibre optic capability in the country to cater to the telecommunication requirements.

"We want to diversify into telecom and develop the fibre optic capability by bringing our technology and from the US," Enron's CEO Kenneth L Lay said at the India Economic Summit 99.

The telecommunications business would be managed by Enron India, an affliliate of the Enron International, and the multinational company would bring in its latest technology to India, Lay said.

Enron would initially plan to focus on the higher bandwidth segment by providing multi-media and video type data-based services, he said. Asked about the investments by the multinational company in the new area, Lay said: "It is too premature to talk about the investments as we are still talking to various companies for collaboration in the telecom sector."

Enron already has a tie-up with Indian Railway Construction Limited for its foray into the telecom sector.

The company operates from its Enron Intelligent Network worldwide. The multinational company, which is setting up a $ 1.2 billion power project at Dabhol, in Maharashtra, is also eyeing other sectors including the liquified natural gas business for which Enron is setting up a LNG terminal at the project site, Lay said.

Talking about the Indian power scenario, Lay said power supply was the most critical area as a minimum of 20-25 per cent of the current level of generation was required to catch up with the immediate needs. The demand for natural gas would triple in 5-6 years and similar would be the demand for oil which is currently at 1.8 million barrels a day.

Apart from the needs of the power sector, an additional $100 billion was needed, Lay said. "This was a tremendous challenge and must be met. Many things need to be alone beginning with the sate electricity boards, which were strained financially due to problems like cross subsidisation, agricultural subsidy and transmission and distribution losses."

Lay was optimistic about the future development in India and Enron would increase its commitments in the infrastrucuture in the areas it worked in. He, however, felt that the government needed to work at a better speed.

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