UK Brown: Assured Level Playing Field For Vodafone Bid

NEW DELHI -(Dow Jones)- The UK's Chancellor of the Exchequer, Gordon Brown, Thursday said that he has been assured of a "level playing field" for Vodafone Group's bid for a stake in Indian mobile phone operator Hutchison Essar.

"We discussed all issues on the financial sector...We have been assured that there is a level playing field," Brown told reporters in New Delhi when asked about Vodafone's pitch for the Hutchison Essar stake.

The UK's Vodafone is one of a number of companies interested in buying Hutchison group's 67% stake in India's fourth largest mobile phone operator by subscribers.

Brown also responded positively to proposed Indian legislation that would increase the cap on foreign insurance companies' shareholdings in domestic insurance firms.

The Indian government is expected to seek Parliament's approval next month for a proposal to raise the foreign shareholding limit to 49% from the current 26%.

Brown said this could be "of great benefit" in particular to the Lloyd's of London reinsurance market.

He said it was a "major step forward" toward the U.K.'s goal of doubling its exports to India by 2010.

Asked about access to India's retail sector for U.K. companies, Brown said this was one of several areas of mutual market access being discussed by himself and the Indian finance minister, P. Chidambaram.

India currently allows 51% foreign direct investment in single brand retail firms. Foreign companies such as UK retail giant Tesco are looking for greater access to the Indian market.

-By Andrew Peaple and P.R. Venkat; Dow Jones Newswires; 91 11 2307 40 20; andrew.peaple@dowjones.com

-Edited by Alan Soughley

(END) Dow Jones Newswires"

Posted to the site on 18th January 2007