'We'll cooperate and compete with Bharti'

A day before coming to India, the country's prodigal son, Vodafone CEO Arun Sarin, put forth his vision at an analysts' meet in London. Excerpts:

On reverse synergies for Vodafone from India

Frankly, we see reverse synergies from being in India. This really transforms our purchasing clout in the low-end (handset) terminal marketplace. There is potential for further outsourcing of Vodafone's operations to the low-cost opportunities in India.

On competition and entry of more global players

In the medium term, there will be some level of consolidation in India. The amount of spectrum available is limited and it is not easy to come in as a new player. I do not see any international brands coming to India in the near-medium term. Of course, anything is possible in the longer term.

On 3G in India

I would say in the six- to 18-month timeframe, the government would figure out what to do in the 3G licensing arena. We will look at that as an incremental thing – whether we are interested in it or not.

On regulation and policies in India

The regulatory picture is encouraging. We are very encouraged by the openness of the authorities towards greater active network sharing that should help drive the penetration and bring affordable communication to a much larger population. We expect the government to allow active sharing over the next two years.

On the infrastructure agreement with Bharti Airtel

It covers infrastructure sharing and is designed to lower our total cost of business. Regulations permitting, we will go on to active network sharing (spectrum, electronics and transmission) in time. This will lower costs even further.

Our agreement with Bharti covers this. There are real benefits to be had, not just from spectrum sharing, but also in areas such as intra-circle roaming. What we are doing with Bharti is both good for the company and the country.

On retaining 4.4 per cent equity in Bharti

It gives us enough comfort that there are incentives in line to make sure that the site-sharing plan works and they are interested in doing it.

We are going to be doing everything to make sure that we are maximising the value of the 67 per cent, but have enough incentive to make sure that the site sharing is coming along.

So, it will be competition (with Bharti) in the marketplace and cooperating (with it) in building up the infrastructure.