BT Worldwide managing director (India & Saarc) Arun Seth told The Financial Express, "Until there is certainty over the shape of the final telecom policy, investment decisions for India cannot be made".

He said: "If the licence fee regime is not replaced by a revenue sharing mechanism, I doubt if we will invest anything in the future".

Citing the case of Malaysia, which recently upped the foreign investment limit from 25 per cent to 40 per cent, Seth said while other countries in the APAC region were welcoming foreign investment in telecom, India remained prejudiced to the very idea of majority foreign stake.

"This will lead to a downfall in foreign direct investment in the telecom sector and sound the death knell of the second phase of telecom reforms, unless there is certainty in the policy", he added.

Seth saidthat foreign companies were unsure of the market in India and had made the best of breed predictions. "Companies got it all wrong on market and usage trends for the cellular industry", he added.

Expressing disappointment over the draft telecom policy, Seth said that the policy did not add upto much, either in terms of future proofing for technological trends or for resolving the current problems like the issue of licence fee payment.

"In the present investment climate worldwide, foreign investors can choose between a lot destinations or simply decide to concentrate on traditional or home markets", said Seth. Telecom investors in India have not been able to make money as the rate of return on investment has been very poor.

He cited another example of the inhibitive policy apparatus in the country in the case of BT's three year old proposal for setting up a regional hub for long-distance phone calls in partnership with Videsh Sanchar Nigam Ltd (VSNL).

"Inspite of this we remain committed to the Indianmarket and proof of this fact is that we recently upped our holding in Airtel (a joint venture with Bharti Telecom) to 39.5 per cent", he said.

British Telecom has four joint ventures in India with 50 per cent stake in Bharti-BT for VSAT services, 49 per cent stake in Bharti Internet Ltd and a 40 per cent stake in Mahindra BT Ltd for billing solutions.

The company also has a bilateral agreement with VSNL for providing and operating international telephony and other telecom services between Britain and India. BT is one of the largest telecom companies in the world with market capitalisation of 25 billion pounds, with 1.27 lakh employees in over 55 countries.