Printed at Thomson Press Every Single Day, We Trust in a Myriad of Ways

Printed at Thomson Press Every single day, we trust in a myriad of ways. Every single day trust brings us many opportunities. To enrich our knowledge. To strengthen our determination. To elevate our self respect. It allows us, our partners and our customers to thrive through healthy collaboration. To be trusted is the most valuable compliment that keeps us going. To make this trust unbreakable we have worked at reinforcing its foundation. Every single day. Table Table 18 17 16 15 14 13 12 11 10 09 08 07 06 05 04 03 02 01 fcontents of CEO &JMD’ Board ofdirectors Chairman’s message Performance ataglance Top 30shareholders Corporate history Corporate information Circle offices Consolidated financialstatementswithAuditors’report Standalone financialstatementswithAuditors’report Secretarial auditreport Report oncorporategovernance Management Discussion&Analysis Directors’ report Awards &Honours Corporate SocialResponsibility Unbreakable trust Deputy CEO’ S S message message 149-191 94-148 92-93 76-91 68-75 39-67 36-37 26-35 18-25 16-17 14-15 10-13 192 8-9 4-5 7 6 3 1 BHARTI AIRTEL ANNUAL REPORT 2008-09 Unbreakable trust

“The glue that holds all relationships together - including the relationship between the leader and the led is trust, and trust is based on integrity.”

- Brian Tracy 01 Corporate information

Board of directors Statutory Auditors Sunil Bharti Mittal S. R. Batliboi & Associates, Chairman and Managing Director Chartered Accountants

Manoj Kohli CEO & Joint Managing Director Auditors - US GAAP Ernst & Young

Non-executive directors Ajay Lal Internal Auditors Akhil Gupta Price Waterhouse Coopers Private Limited Arun Bharat Ram Bashir Abdulla Currimjee Chua Sock Koong Registered & Corporate Office Craig Ehrlich Aravali Crescent, Nikesh Arora 1, Nelson Mandela Road Mauro Sentinelli Vasant Kunj, Phase - II N Kumar New Delhi – 110 070 Paul O’ Sullivan Tel: +91 11 46666 100 Pulak Chandan Prasad Fax: +91 11 41666 137 Quah Kung Yang E-mail: [email protected] Rajan Bharti Mittal Rakesh Bharti Mittal Website Group General Counsel & Company Secretary http://www.airtel.in Vijaya Sampath

BHARTI AIRTEL ANNUAL REPORT 2008-09

3 02 Corporate history

Each year of our existence has been marked by historic and far reaching milestones including many ‘ﬁ rsts’, all of which have been stepping stones to our success and performance. A brief history of the Company’s major events is summarized below:

• Mobile services under the brand name ‘Airtel’ launched 1995 for the first time in Delhi and Himachal Pradesh - 1996 • British Telecom Plc (BT) acquires a stake in the Company

• Is the first private telecom service provider to obtain a 1997 license for landline telephony in Madhya Pradesh - 1998 • Incorporation of Bharti BT VSAT Ltd. for providing VSAT solutions across India and Bharti BT Internet Ltd.

establish seek explore trust imagine innovate envisage reach dream

• IndiaOne, India’s first private sector national 2001 and international long distance service - launched 2002 • Eastern foray through acquisition and new licenses for eight new circles across India • India’s first private submarine cable landing station in a joint venture with SingTel • Initial Public Offering (IPO) through India’s first 100% book-building issue • First private operator to offer basic telephone services in Haryana, Delhi, Tamil Nadu and Karnataka • The largest private sector telecom operator in India 1999 after acquiring JT Mobile for providing cellular services - in Punjab, Karnataka and Andhra Pradesh 2000 • Acquires Skycell, Chennai and expands its South Indian footprint • Singapore Telecommunications Ltd. (SingTel) acquires Telecom Italia’s equity stake in the Company erhisieta idmpru icvrredeﬁ discover pursue wisdom team inspire search 2003 2001 - leading mobileoperatorsintheAsianregion • FoundingmemberoftheBridgeMobileAlliance,aconsortiumseven • FirstprivateoperatortolaunchmobileservicesinJammuandKashmir systemconnectingIndiawithSouthEastAsia,theMiddleandEurope • BecomespartownerinSEA-ME-WE-4,a20,000kmnextgenerationcable RajasthanandholdingalicensetoofferservicesintheNorthEast • AcquiresacontrollingstakeinHexacom,theleadingmobileoperator Company’scoreITandnetworkactivities • StrategicpartnershipswithIBMandEricssonforoutsourcingofthe • JoinstheUS$1bnrevenueclub 2008 2006 - infrastructureservicestoallmobileoperatorsin India inBhartiInfratel,asubsidiaryestablishedwiththeaimto providepassive • ReceivesUS$1.275bninvestmentfromleadinginternational investors bandwidthsubmarinecablesAAG,I-ME-WEandUnity • Joinsinternationalconsortiaofleadingtelecomcompanies tobuild3high operateinternationalcarrierfacilitiesfromSingapore • FacilityBasedOperatorlicenseinSingapore,enablingthe Companyto offerMicrosoftWindowsMobile5.0technology • Strategictie-upwithMicrosoftandbecomesthefirsttelecom operatorto • StrategicpartnershipwithGoogle,enablingsearchthrough mobilephones countries aimedattheIndiandiaspora • Launchof‘AirtelCallHome’service,acallingcardservicefor • Receiveslicenseforproviding2Gand3GmobileservicesinSriLanka • ProfitcrossesUS$1bn 2006 2005 - operatorbasedonthetotalcustomerbase • BecomesIndia’slargestintegratedprivate theCompany • Vodafoneacquires10%economicinterestin servicesinAssam • All-Indiafootprintwiththelaunchofmobile n civ growth achieve ne 5 BHARTI AIRTEL ANNUAL REPORT 2008-09 03 Top 30 shareholders HOLDERS* %

1 Bharti Telecom Limited 45.30 2 Pastel Limited 15.58 3 Indian Continent Investment Limited 6.27 4 Life Insurance Corporation of India 4.23 5 Europacific Growth Fund 1.68 6 Fidelity Management and Research and Funds 1.26 7 Copthall Mauritius Investment Limited 0.97 8 JP Morgan Asset Management and Funds 0.98 9 ICICI Prudential 0.82 10 Emerging Markets Fund 0.73 11 Skagen Funds 0.59 12 Bajaj Allianz Life Insurance Company Limited 0.51 13 Schroder Funds 0.48 14 T Rowe Price 0.43 15 Capital International 0.38 16 Deutsche Securities Mauritius Limited 0.36 17 Merrill Lynch 0.36 18 UTI Mutual Fund 0.33 19 Mavi Investment Fund Limited 0.32 20 Government of Singapore Investment Corporation 0.29 21 SBI Life Insurance Company Limited 0.29 22 PCA India 0.28 23 Birla Sun Life Mutual Fund 0.27 24 Coment Mauritius Limited 0.27 25 Franklin Templeton Funds 0.27 26 Norges Bank A/c Government Petroleum Fund 0.27 27 Lotus Global Investments Limited 0.26 28 Aberdeen Asset Managers 0.25 29 M and G Investment Management Limited 0.24 30 Pru India Equity Open Limited 0.24

TOTAL 84.51

*Different funds/entities under the same group have been clubbed together Data as on April 24, 2009 FY04 FY05 FY06 FY07 FY08 FY09 FY04 FY05 FY06 FY07 FY08 FY09 04 oieSrie 0’ ,0 0941,7 3,4 195 93,923 2,726 61,985 2,283 96,649 37,141 1,871 64,268 19,579 1,347 39,013 10,984 857 20,926 11,842 6,504 637 7,141 000’s 000’s 000’s Telemedia Services Mobile Services Total customerbase annsprsae(ai)R. 31 65 1.8 14 42 41.40 34.23 153.45 0.55 30.38 21.43 0.29 114.46 29.51 21.0% 0.36 40.9% 0.19 30.7% 10.78 23.7% 60.59 26.47 42.2% 0.58 33.3% 30.9% 0.37 22.1% 6.53 84,022 40.4% 38.87 17.45 1.00 38.5% 31.6% 0.57 40,886 17.4% 35.7% 28.70 9.65 3.15 1.34 43.1% 21.5% 375,301 42,867 0.77 14.9% 37.6% 258,130 32.0% 26.52 15.7% 5.24 41,738 2.48 78,590 291,279 157,750 11.6% 0.86 63,954 33.9% 23.7% 217,244 152,858 41,171 115,362 Rs. 9.9% 85,910 114,018 114,884 40,621 94,371 373,521 73,115 Times 74,407 42,292 12.0% Times 73,624 Rs. 270,122 20,279 Times 46,784 41,636 91,438 184,202 % 53,200 12,116 % 135,769 23,455 116,641 30,658 % Earnings pershare(Basic) Rs.mn 111,535 Net DebttoStockholder’sEquity 49,146 81,558 5,837 15,832 73,037 Rs.mn % Book valuePerEquityShare 17,055 Interest coverageratio 40,006 50,369 5,527 Net DebttoEBITDA Rs.mn Rs.mn 28,219 Return onCapitalemployed Rs.mn Return onStockholdersEquity Net ProfitMargin Rs.mn 14,363 Rs.mn EBITDA Margin KEY RATIOS Capital Employed Rs.mn Net Debt Stockholder’s Equity BASED ONBALANCESHEET Profit aftertax Earnings beforetax Cash profitfromoperations EBITDA Revenue BASED ONSTATEMENTOFOPERATIONS PARTICULARS is notinitselfanexpresslypermittedGAAPmeasure. The financialsprovidedinthetableabovearederivedfromamountscalculatedaccordancewithIGAAPconsolidatedfinancial Performance RETURN ONCAPITALEMPLOYED(%) REVENUE (Rs.mn) 50,369 9.9% 81,558 116,641 15.7% UNITS 184,202 21.5% FY04 FY05 FY06 FY07 FY08 FY09 FY04 FY05 FY06 FY07 FY08 FY09

at aglance 270,122 30.5% PROFIT AFTERTAX(Rs.mn) 0420 0620 082009 2008 2007 2006 2005 2004 31.6% NET DEBTTOEBITDA(Times) 33.3% 5,837 373,521 12,116 0.36 Full yearendedMarch31, 20,279 0.55 0.58 40,621 1.00 statements andthisinformation 1.34 63,954 78,590 2.48 7 BHARTI AIRTEL ANNUAL REPORT 2008-09 “ Thanks to consistent support from our partners, our businesses have scaled up signifi cantly and added new revenue streams. As the market matures further, we expect more opportunities to come our way. Our strong market leadership position, along with unshakeable customer trust built over the years, should enable our empowered leadership team to make the most of these opportunities. I look forward to another successful year.” 05 additional spectrumwhentheprocessisfinalized. spectrum andyourCompanywillbebiddingforallocationof has alreadyformulatedguidelinesfortheauctionof3G the remotestcornersofcountry.Thegovernment the digitaldividebytakingwirelessbroadbandtoeven has datacapabilityandwillplayanimportantroleinbridging and significantlyinfluencemarketdynamics.3Gtechnology as newplayersandtechnologies,including3G,enter In thenearfutureIndiaislikelytowitnessplentyofaction strategy going forward. We ourinternational topursue aredetermined and profi business modelcanbeeffectively the Airtel thelaunchhasjustifi of s runaway The Lanka. Sri in operations aspirations,international we commenced As afi strengthens itsbrandleadership. such asDTHandIPTVwillensureAirtelretainsfurther we havebeenabletobuild.Theadditionofnewservices to leveragethebenefitsofstrongcustomertrustthat Company, with100millioncustomers,iseminentlyplaced to playanimportantpartintheIndiangrowthstory.Your remarkable incomparison.Thetelecomsectorcontinues in 2008-09istheslowestsince2003,butstillrobustand but remainedarareoasisofgrowth.Our6.5%GDPgrowth a severerecession,Indiaexperiencedrelativeslowdown Even asmajoreconomiesaroundtheworldgrappledwith India,inunprecedentedways.making apositive impactacrossrural peopleand joint venture withIFFCO, thelives we of aretouchingandtransforming results.gratifying network With andtargeted ourcountry-wide initiatives, suchasthe spreading thebenefi past year was, inmany respects. withoutadoubt,transformational Ourfocuson your Company ismarked withsomememorable years. of However,The history the Dear Shareholders, Chairman’s rst step towardsrst our pursuing tably replicated inothercountries. ts of telecommunications in rural India has yielded particularly Indiahasyieldedparticularly telecommunications inrural ts of ed ourconviction that uccess message Chairman andManagingDirector Sunil BhartiMittal Board asexecutivedirector. also delightedtoinformyouthatManojKohlihasjoinedthe Kung Yangwhohavejoinedasnon-executivedirectors.Iam our newmembersCraigEhrlich,NikeshAroraandQuah guidance duringtheirtenure.AtthesametimeIwelcome Airtel’s Board.Ithankthemfortheirvaluablecounseland Francis HengandKurtHellstromhaveretiredfromBharti through financialcontributionsandvolunteering our employeesareparticipatinginthisprogramme,both children. Iamhappytonotethatanincreasingnumberof on itswaytowardrealisinggoalofschooling100,000 privileged childreninruralIndia.TheFoundationiswell which isfocusedonprovidingqualityeducationtounder- The BhartigrouphasestablishedFoundation, changing lives,evenbeyondthedomainofourbusiness. millions oflivesinpositiveways.Weremaineagertokeep In thecourseofrunningitsbusiness,BhartiAirteltouches leadership capabilitytotakeBhartiAirtelthenextlevel. of ‘OneAirtel’.Ibelieveourmanagementteamhasthe opportunities, leveragescaleandbuildthecostsynergies organisational changesinordertomanagefuturegrowth course oftheyear,wehaveundertakenkeyapex-level their continuouscommitmenttooursuccess.Duringthe endeavour. Iwouldliketoexpressmyappreciationfor Employees havealwaysbeenatthecentreofour 9 BHARTI AIRTEL ANNUAL REPORT 2008-09 06 Board of directors

SUNIL BHARTI MITTAL Sunil is Chairman and Managing Director of Bharti Airtel Ltd. He is Member of the Indian Prime Minister’s Council on Trade and Industry and serves on the Board of the International Telecommunication Union (ITU), the leading United Nations Agency for Information and Communication Technology. Sunil is a Trustee of the Carnegie Endowment for International Peace. He is Past President of CII, the Confederation of Indian Industry (2007-08) and was Co-Chairman of the World Economic Forum in 2007 in Davos. He is a member of the Forum’s International Business Council. Sunil is a member of the Board of Governors of IIM, Lucknow and IIT Mumbai. He co-chairs the Bharti School of Telecommunication Technology and Management at IIT Delhi. He is also a member of the Harvard Business School India Advisory Board and the INSEAD Global India Council. Sunil Bharti Mittal has been honoured with one of India’s highest civilian awards, the Padma Bhushan. He is the Honorary Consul General of the Republic of Seychelles in New Delhi, India. Sunil is an Honorary Fellow of The Institution of Electronics and Telecommunication Engineers (IETE). The degree of Doctor of Science (Honoris Causa) was bestowed upon him by the G.B. Pant University of Agriculture & Technology (India). He is also an alumnus of Harvard Business School (USA). He is a Trustee of Bharti Foundation, which is dedicated to the promotion of education and child welfare.

MANOJ KOHLI Manoj is the CEO & Joint Managing Director of Bharti Airtel Ltd. Prior to joining Bharti he worked with DCM (where he started his career in 1979), Allied Signal/Honeywell and Escotel in various senior leadership positions. Manoj is a member of the GSM Association (GSMA) Global Board and Cellular Operators Association of India (COAI). He was Past Chairman of the COAI in 2001-2002. He is a member of the Academic Council of the Faculty of Management Studies of Sri Ram College of Commerce, Delhi University. Manoj is a Commerce and a Law Graduate, and holds an MBA degree from FMS, Delhi University. Manoj also attended the Executive Business Program at the Michigan Business School and the Advanced Management Program at the Wharton Business School.

AJAY LAL Ajay is independent non-executive director of Bharti Airtel Ltd. He is a Senior Partner and Managing Director of AIF Capital with over 20 years’ experience in private equity, project finance and corporate banking. Before joining AIF Capital in 1997, Ajay worked with AIG Investment Corporation and Bank of America. He represents AIF Capital on the boards of a number of large corporations across Asia, and in this capacity enforces strict standards of corporate governance while providing the management teams with strategic guidance. Ajay is an Engineer from IIT Delhi and an AMP graduate from Harvard Business School. He also holds an MBA from IIM Calcutta.

AKHIL GUPTA Akhil is an executive Director of Bharti Airtel Ltd. He is the Deputy Group CEO & Managing Director of Bharti Enterprises Ltd. and is very actively involved in the newly established telecom tower companies through his roles as Chairman of Indus Towers Ltd. (a Joint Venture between Bharti Airtel Ltd., Vodafone Essar Ltd. and Aditya Birla Telecom Ltd.) and Managing Director of Bharti Infratel Ltd. Akhil also serves on the boards of Bharti AXA Life Insurance Ltd. and Bharti AXA General Insurance Ltd. He is a member of the Advisory Board of Confederation of Indian Industry (CII). Akhil is a Chartered Accountant and an AMP graduate from Harvard Business School. Accountant andaCharteredFinancialAnalyst. a 1stClassHonoursDegreeinAccountancyfromtheUniversityofSingaporeandisCertifiedPublic October 2006andinApril2007,sheassumedthepositionofSingTelGroupCEO.SockKoongholds after thekeydriversofSingTel’sinternationalbusiness.ShewasappointedDeputyGroupCEOin In February2006,SockKoongassumedthepositionsofGroupCFOandCEOInternational,looking 1999, withresponsibilityfortheGroup’sfinancialfunctions,includingtreasuryandriskmanagement. May 2001.ShejoinedSingTelinJune1989asTreasurerandwasappointedChiefFinancialOfficer Sock KoongisanomineeofSingTelandwasappointedasnon-executivedirectorBhartiAirtelin CHUA SOCKKOONG where hecompletedtheExecutiveCourseonOPM(Owner/PresidentManagementProgram). Economics andGovernment)ofTuftsUniversity,USA.HeisanalumnusHarvardBusinessSchool Mauritian ManufacturersandalsotheJointEconomicCouncil.BashirisanArtsgraduate(majorin 15 yearsandtheChairmanofMauritiusChamberCommerceIndustryAssociation financial servicesandtravelinMauritius.HewasadirectoroftheCentralBankMauritiusfor established in1890andtodayhasdiversebusinessinterestsmanufacturing,trading,energy, Committee. BashirisaleadingindustrialistandtheChairmanofCurrimjeeGroup,whichwas independent directorsandamemberoftheBoardHRCommitteeESOPCompensation Bashir hasbeenanindependentdirectorsince2001.Heisalsotheleadamong BASHIR ABDULLACURRIMJEE of Michigan,USAandholdsadiplomafromtheTechnicalUniversityDarmstadt,Germany. (India) andLadyShriRamCollegeinDelhi.HegraduatedIndustrialEngineeringfromtheUniversity keen interestinpromotingeducationandservesontheGoverningBoardofDoonSchool,Dehradun Co-Chairman oftheIndoGermanconsultativegroup,aGovernmentIndiaappointment.Hetakes Confederation ofIndianIndustry(CII)andiscurrentlyChairmanCIIFamilyBusinessCouncil.Hethe Synthetics BusinesswinningthecovetedglobalDemingAwardin2004.ArunwasPresidentof of corporategovernance,qualityandprofessionalisminmanagementledtoSRF’sIndustrial and outsideIndia,marketleadershipinallitsmajorbusinesses.Hisstrongsupportofinitiatives and promotionofartculture.HeisthefounderChairmanSRFLimited,whichhasplantsin since March2006.Heisamemberofleadingfamilyindustrialists,knownfortheirphilanthropy Arun hasbeenanindependentdirectorofBhartiAirtelandamembertheBoardAuditCommittee ARUN BHARAT RAM from OccidentalCollegeandaPostgraduate FellowshipfromCoroFoundation. Craig isaGraduatefromtheUniversity ofCalifornia,LosAngeles.HereceivedhisMastersdegree a boardmemberoftheITUTelecom andhasservedformanyyearsastheChairmanofGSMA. an onshoringandoutsourcingsoftware companydevelopment,headquarteredinHongKong.Heis largest cabletelevisioncompany, kbro.HeisChairmanandFounderofNovareTechnologiesLtd, Chairman ofEasternCommunicationsThePhilippines.Inaddition, heisChairmanofTaiwan’s Hutchison TelecommunicationGroupandadvisesthegroup’sbusinesses worldwide.HeisVice multi-channel televisionnetwork.HejoinedHutchisonWhampoa in 2003asaboardmemberof 1987. HewasafoundingmemberoftheteamthatlaunchedStar TV, Asia’sfirstsatellite-delivered Craig hasbeeninvolvedinAsia’scommunicationsindustrysincehe joinedHutchisonCablevisionin CRAIG EHRLICH 11 BHARTI AIRTEL ANNUAL REPORT 2008-09 06 Board of directors

NIKESH ARORA Nikesh is an independent non-executive director and a member of the HR Committee and ESOP Compensation Committee of Bharti Airtel. Nikesh is President, EMEA Operations & Senior Vice President, Google where he oversees all revenue and customer operations, as well as marketing and partnerships. Prior to joining Google, he was chief marketing officer and a member of the management board at T-Mobile. Before joining T-Mobile/Deutsche Telekom, Nikesh held management positions in Putnam Investments and Fidelity Investments in Boston. Nikesh holds a Masters degree from Boston College and MBA from Northeastern University, both of which were awarded with distinction. He also holds the CFA designation and has a Bachelor’s degree in electrical engineering.

MAURO SENTINELLI Mauro is an independent non-executive director and member of the Board HR and ESOP Compensation Committees. He served Telecom Italia from 1974 to 2005. During this period he held various senior management positions including positions abroad and Group Managing Director. From 2002 to 2005, Mauro was a member of the Board of Telecom Italia. He is a founder member of the GSM Association which currently has membership from operators in over 210 countries with 2.5 billion customers globally. He was elected Deputy Chairman of the GSM Association in 2003 and again from 2005-08. Mauro has a doctorate in electronic engineering from the University of Rome. He holds a Masters degree in Telephony from Turin University and MBAs from Insead and Kellog.

N KUMAR Kumar has been an independent director and member of the Audit Committee since 2001. He was elected Chairman of the Audit Committee in August 2003. Kumar is Vice-Chairman of The Sanmar Group, a well known Indian Industrial Group with interests in chemicals, engineering and shipping. He is an active spokesperson of industry and trade and was the President of Confederation of Indian Industry (CII), a leading industrial body. He also participates in various other apex bodies and is on the board of various public companies. He is the Honorary Consul General of Greece in Chennai and the Honorary Business Representative of the International Enterprise, Singapore. N Kumar is a Graduate Engineer in Electronics and Communication Technology.

PAUL O’SULLIVAN Paul is a nominee of SingTel and has been a non-executive director of Bharti Airtel since April 2004. He is also a member of the Board HR and ESOP Compensation Committees. He is the Chief Executive Officer of SingTel Optus Ltd., Australia’s second largest telecom company. Paul is also a member of the SingTel Group management committee and has significant group-wide responsibilities. Prior to joining Optus, he held various international management positions in the Royal Dutch Shell Group in Canada, the Middle East, Australia and the United Kingdom. Paul is a graduate in Economics from Trinity College, Dublin and has attended the Harvard Business School’s Advanced Management Program. Punjab UniversityandanalumnusofHarvardBusinessSchool,USA. as -AUSPI)in1999-2000.RajanisalsoaTrusteeofBhartiFoundation. HeisanArtsgraduatefrom 2004 and2005.HewasPastPresidentoftheAssociationBasic TelecomOperators(nowknown of theTelecomCommitteein2001,2002and2003Chairman&IT the RetailCommitteeofFICCIin2007,ChairmanInfrastructure2006, Executive CommitteeofInternationalChambersCommerce–IndiaChapter.HewasChairman Member oftheCouncilManagementAllIndiaAssociationanda He isaMemberoftheManagingCommitteeandStandingCommitteesPHDCCI.also Chambers ofCommerceandIndustry)MemberFICCI’sExecutiveSteeringCommittees. and amemberoftheBoardHRCommittee.RajanisVicePresidentFICCI(FederationIndian Wholesale andRetailBusiness.HeistheChairmanofBoardESOPCompensationCommittee Rajan istheManagingDirectorofBhartiEnterprisesLtd.andGroupLeadBharti’s RAJAN BHARTI MITTAL Public AccountantsofSingaporeandagraduatetheUniversityKentatCanterbury,England. the InstituteofCharteredAccountantsinEnglandandWales,amemberCertified International FinanceandGlobalBusinesspriortohiscurrentportfolio.KungYangisaFellowof has heldvariouspositionsinSingaporeandtheregion,areasofCorporateFinance,Tax, wholesale basistotelecommunicationserviceproviders.KungYangjoinedSingTelin1992and Joint Ventureinaregionalsubmarinecablenetwork,providingcity-to-cityconnectivityon region. BeforejoiningtheInternationalGroup,hewasChiefFinancialOfficerofC2C,aSingTel SingTel, overseeingnewinvestmentopportunitiesaswellexistinginvestmentsintheAsian Kung Yangisanon-executiveSingTelnominee.HeVicePresident,InternationalGroupin QUAH KUNGYANG B. TechdegreefromIITDelhiandanMBAIIMAhmedabad. management consultantwithMcKinsey&CompanyinIndia,USAandSouthAfrica.Pulakhasa and SouthEastAsianoperations.HejoinedWarburgPincusin1998.From1992to1998,Pulakwas was ManagingDirectorandco-headoftheIndiaofficeWarburgPincus,coveringtheirIndia,South Capital, aSingaporebasedfundmanagementandadvisorycompany.BeforecreatingNalanda,Pulak Board asanomineeofWarburgPincusinNovember2001.PulakistheFounderandMDNalanda Pulak isanindependentdirectorandmemberoftheBoardAuditCommittee.Heinitiallyjoined PULAK CHANDAN PRASAD electronics engineer. 1999 andisPastChairmanofthe NorthernRegionandvariousCIINationalCommittees.Rakeshis an the promotionofeducationandchild welfare.HehasbeenaMemberoftheNationalCouncilsince institutes inIndiaandabroad.Rakesh isalsoaTrusteeofBhartiFoundation,whichdedicatedto of therighttogoodeducation,RakeshservesonGoverningBoards ofmanyeducational Development Authouthy[APEDA]andPunjabEducation Board.Apassionateadvocate of BhartiTeleTechLtd.RakeshisamembertheAgriculturaland ProcessedFoodProductsExport Rakesh istheVice-ChairmanofBhartiEnterprisesLtd.andVice ChairmanandManagingDirector RAKESH BHARTI MITTAL 13 BHARTI AIRTEL ANNUAL REPORT 2008-09 07 CEO & JMD’s message

Dear Shareholders,

2008-09 was an extraordinary year in more ways than one. Even as the world economy sailed perilously in a stormy slowdown, India remained a rare bright spot, with a moderate, but still a healthy growth rate. For Bharti Airtel the year turned out to be the best ever with incremental revenue of close to Rs 100bn and over 32 million new customers. Your Company achieved several significant landmarks during the period with launch of service in Sri Lanka, and introduction of a string of new services like DTH and IPTV for customers back home.

During the year we reached another significant strategic milestone with the realization of the One Airtel objective both at the front end and the backend operations. Seamless integration of the backend IT and network platforms has now a symbolic reflection at the front end, where Airtel Relationship Centres sell everything from mobile, broadband to DTH connections. With the expansion of the product portfolio, we are today one of the most integrated telcos in the world. Nearing the 100 million customer mark, and with a presence in multiple telecom, internet and media domains, we have outpaced both scale and operational complexities of global telecom majors.

Great teamwork has made this possible. I would like to thank each one of our employees for their passion and dedication towards the cause. We have a truly world- class leadership team in place today. I am really proud of them. We will continue our Brand Airtel is well on its way to be the Most Admired efforts to develop a robust leadership pipeline Brand in India by 2010. Ranked second behind LIC as the for the future. most trusted brand in the country, we are already up there. Along with Trusted we are intent on becoming the most Last year was quite a revealing period for us in terms of Innovative brand in the country, delivering the most customer insights. Focus on affordability is no longer the exciting and creative services in all domains. The search key driver as customers have become virtually agnostic to for new revenue streams across mobile, internet, enter- tariffs. Their expectations have clearly moved to the next prise, particularly the SMB segment will continue to be our level. Product innovations and customer service levels, priority. A consistent focus on benchmarking will also where we consistently scored over competition throughout enable us to deliver cost efficient service. The business the year, have become more critical. Our customer em- model is set to get leaner to deliver healthy financial results powerment strategy proved a key differentiator. At the despite lower call rates. heart of this strategy lie robust processes that enable customers to change their bill plans or start and stop services We have really grown large in the last few years. But we at will, reducing the need for intermediation. have steadfastly held on to the soul of a small company, even as we diligently internalized structures and processes, I expect the economy to register significant recovery by the so very essential to sustain large operations and scale. end of 2009-10. Rural India will clearly be a key driver for Passion for entrepreneurship and the agility to come out telecom growth in the country. At a penetration rate of just with out-of-the-box ideas constitute the core of our DNA. below 13%, we see major potential out there. The partner- Despite our size, we have managed to keep hierarchy and ships with IFFCO and Nokia launched last year have already bureaucratic tendencies at bay. As we grow further, we will created a huge transformational impact in rural India with continue to dream big with the soul of a small company. enhanced agricultural productivity and quality of life. We will seek to introduce more such initiatives and bring about a profound rural impact. “ Year after year, we have surpassed market expectations, and to be honest - sometimes our own expectations - with robust customer and revenue growth. In parallel, we have built a solid foundation of corporate governance. Turning challenges into opportunities has become a habit of our passionate employees and leadership team. The coming year will be no exception.”

India is going to achieve one billion telecom customers by 2015. The market dynamic will, of course, have changed considerably by then. After crossing the 100 million mark, we are going to be focused on the next 100 million, which we believe will be well within our reach in another three years time. Given the fact that under-penetrated rural India is going to provide the bulk of the immediate future growth, connecting the villages will be our priority in the years to come.

From a voice-only telecom company we have transformed into one of the most integrated telcos in the world, impacting lives of people across several touch points. Brand Airtel too will see a transformation. With a significantly enhanced role in the lifestyle space, we will be seen more as a lifestyle enabler. Our ‘three screen strategy’ – phone, computer and TV – has already taken us some distance on that path. A deeper footprint of new services like m-commerce, m-entertainment, games and exciting content such as from our tie up with Manchester United will see the culmination of this process.

Our partners continue to play a big role in our success. Our ability to conceive and execute game-changing strategies is built around their committed support. Along- side Ericsson, Nokia-Siemens and IBM in the network management and IT space, we have been partnered by many others in the operational space starting from distribution to customer service. We see these partnerships grow in scale and diversity in future.

Manoj Kohli CEO & Joint Managing Director

15 08 Deputy CEO’s message

Dear Shareholders,

2008-09 went down as another remarkable year in the journey of Bharti Airtel. Though the global economic trends appeared bleak throughout last year, the Indian economy, the telecom sector and Bharti Airtel in particular withstood the recessionary storm with remarkable poise and determination. Besides strengthening our financial health and registering free cash flows for the first time, we also went ahead and forayed into new geographies with the launch of Sri Lanka operations and new product categories with the launch of DTH and IPTV services. The recent past also witnessed several competitors launching operations in different circles across India; however Bharti Airtel’s robust business model was able to successfully withstand all competitive threats. In fact it indeed is a matter of great pride for me to say that it’s this element of unbreakable trust which our customers share with us which has got us this far and it’s this relationship of trust and faith which will take us places in the future as well.

As we continue to venture into new towns and villages, we see that our next round of acquisitions would come from youth and rural India. There are 560 million youth in India thriving on instant gratification and experience. The future will see the emergence of digital natives -“born” into digital technology, accustomed to the instantaneity of hypertext, downloaded music, phones in their pockets — on 24/7, a library on their laptops/computers and most importantly expecting connectivity anytime and anywhere. Going forward our outlook needs to completely transform to understand their expectations and lifestyle.

Right now around half of our new customers are rural; as we acquire more customers this ratio could shift to up to 75%. Currently just 13% of rural India has phones, so there is a long way to go. We will certainly have to redefine the entire rural ecosystem, with new or revised partnerships, brand-connect, service offerings, communication plans and distribution strategies. One of the redefining steps in our rural journey has been the creation of Airtel Service Centers. We already have around 18,000 of these up and running in villages, enabling us to cater to 400 different languages and dialects. This concept has really worked wonders for us, mainly because we have local people serving our rural customers instead of town and city people. As we break Going forward our strategy will focus on further into these markets, you will continue to observe the consumers’ entire wallet, not just a innovations in our rural business model that will ensure Airtel’s sustained competitive advantage. share of his or her telecom wallet. We are in the process of building an ecosystem of stakeholders that will facilitate this shift. Already we have reached a point at which we sell more music than the traditional music companies and when data-pipes get broadened with 3G and HSPA, you will see numerous other internet applications come up. We have a firm belief that for most Indians the first internet experience, much like it was the case for voice, will be on a wireless device. The future will without a doubt offer us great opportunities to participate in the revenue streams of many industry verticals such as financial services, music, video, gaming, retail and rural market services. “ I am conﬁ dent and optimistic that our commitment to innovation, pursuit of excellence and most importantly the drive and passion of our employees will keep us focused Another area of tremendous opportunity lies in the m-commerce domain. Focus areas include: and will be a signiﬁ cant competitive advantage for us, as we continue to lead and embark on our journey towards achieving • Financial Inclusion, involving 80-85% of the unbanked the next 100 million customers.” population. In future, the mobile phone will act as their ATM;

• The domestic money-transfer market. With around Rs. 500 bn being transferred from one part of the country to another through post ofﬁ ces alone every year, this area offers huge opportunities and we believe that we could offer better value-for-money here;

• International money transfer. Around US$ 42 bn is transferred to India each year. Here, instead of competing with banks and ﬁ nancial institutions, we will work with them to speed up the offering and make it pervasive through our 1.2 million retail outlets as no one has wider distribution reach than we have across India.

Soon we will be crossing the 100 million customer milestone. Once we reach this memorable milestone we shall reset our counter for the next 100 million customers and I am confident that the next 100 million customers would ensure the transformation of Airtel from ‘just a telecom brand’ to a lifestyle enabler. Our ‘three screens strategy’ will ensure that those next 100 million customers come from mobile, computers and television screens. As a leading private broadband service provider in the country we have already enhanced our broadband speeds from 8 Mbps to 16 Mbps, making our service the fastest wireline broadband on DSL in the country. Through the IPTV (Internet Protocol Television Service) launch we have gone ahead and delivered the triple play advantage of telephony, broadband and entertainment services via a niche strategy to our customers in select cities. On the DTH front, given our deep understanding of the Indian customers and wide distribution reach, we intend to go mass market with our acquisition strategy, clearly aiming at semi-urban and upcountry markets.

The year 2009-10 will see us complete the final lap to achieve our Vision 2010 and we are very much on track to be the most admired brand in India – loved by more customers, targeted by top talent and benchmarked by more businesses.

Sanjay Kapoor Deputy CEO

09 Unbreakable trust

As the largest telecom brand in the country, Airtel is today counted among the select iconic brands in India’s expansive consumer space. The brand has traversed through several phases of evolution, riding a string of pioneering customer centric innovations, strategic tie-ups with global leaders and winning value propositions. In this journey towards being the Most Admired Brand in the country, Airtel has transformed customer experience in communication in the most decisive way.

Airtel touches customer lives in multifarious ways, improving the quality of living both economically and emotionally. From the fisherman to the farmer to the rural artisan to the roadside vendor in the metro, everyone has found his/her unique way of leveraging connectivity to improve productivity.

As we move on, we believe our connectivity will open up more avenues for economic growth. We have long been mitigating distances connecting people to build enduring bonds. Nurturing human relationships across long distances has become second nature to us. Add to that the seamless way we have been able to integrate communication and entertainment with new services like DTH and IPTV. With a clear and unmis- takable hand in enhancing quality of life, Brand Airtel has been able to build an ‘Unbreakable Trust’ with its customers – individuals, enterprises and the like. BHARTI AIRTEL ANNUAL REPORT 2008-09

19 09 Unbreakable trust Customers

Bharti Airtel’s sustained momentum over the years has been driven by a single-minded focus on its customers and their evolving need-matrix. We have not only expanded our networks rapidly and introduced innovative services in quick succession to enlist millions of new customers into our fold, but have been successfully living up to, and often exceeding, our customers’ expectations by putting in place robust customer satisfaction systems and processes. With close to 100 million customers, and a successful extension of the brand to multiple screens, customer trust continues to gain strength every passing day.

Through the year, Airtel’s reach has expanded to cover 5,060 census towns and 414,906 non-census towns and villages in the country, thus covering approximately 81% of the country’s population. Increasingly, customers are coming from the rural hinterland. This has been made possible by a robust affordability strategy. Alongside a Airtel continued to focus on affordability and convenience continuous scaling down of tariffs, low-cost handset bundle with regard to its strategy vis-à-vis overseas customers as offers have played a key role in our rapid rural roll out. well. We launched the virtual calling card service ‘Airtel call home’ in the UK, Singapore and Canada. We also started Through our joint venture with IFFCO (IFFCO Kisan Sanchar the service for the US based customers who are now able Ltd.), we kicked off a unique initiative to harness the power to call friends and family back in India at just one cent per of telecom to add value to the farm sector. The venture minute. Overseas prepaid recharge service is also available provides information on key elements like weather, farming online and in over 150 money exchanges in the UAE. techniques and commodity rates to the farmers to enhance their productivity. The initiative clearly holds the potential During the year Bharti Airtel extended its mobile services in to trigger a Second Green Revolution directly benefitting Lakshadeep, becoming the first private operator to do so. millions of farmers. Airtel’s trusted network entered Sri Lanka during the last Customers in the metros experienced several new quarter amidst unprecedented customer response. We innovative services during the year. Asklaila, India’s first received close to half a million bookings in the early launch local information service was one of them. The service period and had to urgently fly in hundreds of thousands of enabled Airtel customers to get up-to-date information SIM cards from the nearest marketing centres in India to about their city, free of cost, from the extensive city meet the demand. Airtel’s unconditional free incoming call information database. The asklaila-powered ‘Airtel city has turned out to be truly revolutionary offer for customers search’ is available across Delhi, Mumbai, Chennai, in the island market. Hyderabad, Kolkata and Bangalore.

Customer trust built in the mobile space has clearly been “ extended to new areas like broadband and DTH. The We at Hero Honda greatly treasure our relationship with response to the DTH service, launched during the year has Airtel as our trusted communication partner. Backed by been extremely encouraging. The single screen strategy is its cutting edge network, Airtel has been instrumental in expected to reap substantial dividends in the days to come setting up Hero Honda’s communication backbone. by creating more synergies in our operations. Airtel is also playing a critical role in implementing our new project “Hero Honda Connect” that is aimed at integrating our dealer operations across the country. The partnership with Bharti Airtel is an effort to have common vision for growth. We believe this is just the beginning of an enduring relationship with Airtel that will evolve as we go along. ”

- Pawan Munjal Managing Director & CEO, Hero Honda Motors Ltd. 21 BHARTI AIRTEL ANNUAL REPORT 2008-09

09 “ tion hasbeenabletogenerateamongitsemployees. made possiblebythehighleveloftrustthatorganiza- most soughtafterworkplaces.Thishasclearlybeen among thetop20companiesworldwideasoneof ‘Gallup GreatWorkplaceAward’.ThisplacesBhartiAirtel this scorewereonceagainrecognizedbyyetanother out tobeextremelyproductive.Oursustainedeffortson engagement anddevelopmentprogramstoohaveturned the besttalentavailableinmarket.Ouremployee improved ourlongtermHRstrategytoattractandretain talent. Overtheyearswehavecontinuouslyrefinedand Bharti Airtelasapreferredplacetoworkfortop organization. Thereisaconstantendeavourtoposition People havebeenatthecentreofoursuccessasan President&CEOEricsson - Carl-HenricSvanberg that we willexecute together.” operator engagement. withthe fullconﬁ Itisonebasedonanunbreakable trust extendsThe relationshipbetween beyond EricssonandAirtel thetypicalvendor/ key roleinthesuccessofthesealliances. IFFCO. Complementaritiesandmutualtrusthaveplayeda ships indifferentoperationaldomainswithcompanieslike management andIT,wehaveenterednumerouspartner- and abovethebroadmanagementpartnershipsinnetwork on ourcorecompetencesofmarketingandservice.Over The successofthesepartnershipshasenabledustofocus partners havebeenintegraltotheachievementsofAirtel. Entrusted withmanagingsomeofourcriticalprocesses, have movedupseveralnotchesintermsofsize. deals inworldtelecom.Overtheyearstheserelationships have alreadybeenrecognizedaspath-breakingpartnership Ericsson andNorteltheIToutsourcingdealwithIBM world ofbusiness.NetworkmanagementdealswithNokia, robust partnershipswithsomeillustriousnamesofthe Bharti Airtel’srapidexpansionhasbeenbuiltaroundits Unbreakable People Partners trust relationships. played animportantroleindevelopingtheseenduring satisfaction surveysandAnnualSupplierMeetingshave Regular feedbackfrompartnersthroughformalpartner partnerships. enhance transparenciesandoperationalefficienciesofthe try. Supplychainistirelesslyworkingonnewinitiativesto with alargenumberofsmallerpartnersacrossthecoun- Besides thebigpartnerships,BhartiAirtelisalsoengaged operational intheyeargoneby. joint venturecompanyIndusTowersLtd.havebecomefully to showresults.BothoursubsidiaryBhartiInfratelLtd.and erators andthusleveragetheresultingsynergies,isstarting companies withtheobjectivetosharethoseotherop- Our strategicdecisiontomoveourtowersintoseparate quality inputsfortheemployees. programs arecentralizedtoensure standardizationand specific challengesandwork situations. Mostofthe highly customizedandrelevant toourneedsandthe retention strategy.Learninginitiatives atBhartiAirtelare ties totheemployeesremainsakeyelementofour Providing continuouslearninganddevelopmentopportuni- new perspectivesandpersonalcareergrowthopportunities. across businessunitsandregions,offeringthementirely senior executivesmovedtotakeonhigherresponsibilities filled fromourinternaltalentpool.Alargenumberof the organization.Themajorityofourseniorpositionswere Process tooffergrowthopportunitiesemployeeswithin We remainedintentonfine-tuningourTalentManagement we havebeenpursuingsincelong. taken tofurtherreinforcethelong-termPeoplestrategythat Through theyear,alargenumberofinitiativeswereunder- dence 23 BHARTI AIRTEL ANNUAL REPORT 2008-09 09 Unbreakable trust People

There are various processes through which we get em- “ Being a reverse mentor was a unique ployee development inputs. Employees and managers are opportunity that one seldom fi nds. fully empowered to identify their development needs and capture this in an online system. This encompasses both Interacting with someone so experienced behavioural and functional needs. The Talent Management and learned gave me immense confi dence processes give inputs with respect to future needs and also take into account organizational priorities that define in my day to day life. We’ve had serious as the capability building needs. For our middle management well as fun-fi lled discussions on every topic development programs we work closely with premier organizations like IIM Ahmedabad, IIM Bangalore and Centre for under the sun, yet the comfort level was Creative Leadership (CCL) for general management, partner so high that I ended up gaining a lot more management and Leadership development and people management skills respectively. than I could ever imagine. ”

People management skills are our key focus area. We - Pooja Bajaj Assistant Manager, Airtel Enterprise Services have structured intervention programs at all levels to bring in this cultural shift. For our first time managers we have developed a customized program called “Winning Through People”. For the middle management we have an intervention program known as “Accelerating Performance Through People”. These programs encompass skills in effective Alongside new opportunities for learning and development, communication, motivation, coaching, feedback, empower- we have also consciously worked on performance enhance- ing and developing people. The program also gives inputs to ment tools and processes, and better work-life balance. managers on key Airtel processes which they can leverage Through our e-tize workflow enhancement program we have to manage teams effectively. To support this culture shift simplified approval processes and ensured transparency and we have instituted awards to recognize Best People fairness in all formal employee transactions. This includes Managers. key HR processes such as Competency Assessment and Performance Assessment. Administration oriented process- The Continuous Education Program (CEP) provides opportu- es such as routine approvals too have been brought under nities to all our junior management and frontline employees the ambit of the program. The e-tize workflow enhancement to undertake external distance learning training programmes program has moved one step further during the year. from premier institutes while working. The focus on continuous learning has proven to be a great retention tool in a At Bharti Airtel we have created a unique HR process to highly volatile environment. keep our senior management updated about the changing environment to sustain their professional and personal edge in the long run. Known as Project Rock On, the primary scope of the initiative is reverse mentoring by the younger generation. The senior leader internalizes the new advents, latest technologies and developments in the external world through his/her interaction with a young manager. The focus is also on understanding youth behaviors, their expectations, lifestyles and their thought process.

A lot of planning and research goes into identifying and matching the profiles of the mentors and mentees. The screening process entails profiling candidates, analysis of their hobbies and interests. Once the mentors have been identified, the planning starts to pair them with the mentees. Matching the personality types, individual interests and hobbies as well as the special needs of the mentor are considered critical. After the initial trial with the top team, this initiative will most certainly be rolled out across all circle executive committee teams. 25 BHARTI AIRTEL ANNUAL REPORT 2008-09 10 Corporate Social Responsibility

In today’s competitive environment, businesses continue In 2008-09, we undertook many initiatives in the social to be under pressure to focus their energies on achieving welfare space. We firmly believe that our efforts are their business goals and objectives. But an equally powerful creating a long lasting impact on our stakeholders, both imperative to reach beyond business processes and goals internal (employees) and external (customers, suppliers has also gained ground. At Bharti Airtel, we have always and the community). Internally, we have been able to believed that business success cannot be an end in itself make transformational changes in the workplace to build rather it is a means to a set of higher socio-economic goals. on employee trust. Similarly the trust of our external Over the years we have made a conscious effort to reach stakeholders has further strengthened through our out to society at large, as much as we have striven to involvement in various life spaces – education and training, promote the interests of the stakeholders in our business. health, environment.

Educate and Inspire India’s most conspicuous advantage lies in its demographic situation - its youthful population. When more than 54% of its population belong to the below-25 age bracket, the challenge for the country obviously lies in preparing this large segment for gainful employment - to make it a powerful productive force. Education, of course, plays a critical role in making this possible and we have taken a conscious decision to focus a substantial part of our philanthropic activities on the promotion of education, particularly in the far flung villages, which continue to struggle with poor infrastructure.

Most of our welfare activities are routed through Bharti Foundation, the philanthropic arm of the Bharti Group. Set up in 2000, the Foundation has been working towards improving access to quality education in rural India. Here are some of the programs and projects that Bharti Foundation is undertaking to impact the quality of education in the country:

At the grassroot

Satya Bharti School Program (SBS)

“ Create temples of learning radiating knowledge and excellence for curriculum for these schools has been creatively designed underprivileged children” to empower children to look at education not as a task but as an experience that contributes towards the development The Satya Bharti School Program is the flagship program of important life skills and values in addition to linguistics of Bharti Foundation. Launched in 2006, it aims to make and mathematical skills. available high quality education to poor and under-privileged children – especially the girl child. Within just a few years of Community participation plays a big role in the running of its existence, it has indeed become recognized as one these schools. The Foundation has quite successfully of the most powerful programs in the arena of primary enlisted the support of the village panchayats and local education. The Foundation is responsible for end-to-end bodies in running these schools. Community participation management of the schools, right from construction to is ensured through various modes like contribution of land, imparting of education. sponsoring of mid-day meals and its utensils, sponsoring of materials used in school construction, sponsoring of statio- The Program operates with a two pronged approach. On nery for use in schools and also to monitor school activities. the one hand, the Foundation builds new primary schools from scratch and operates them on its own with active The Satya Bharti School Program has made significant support from local communities. On the other hand, it also progress since its inception in 2006. In just two years, 158 partners the State Governments to adopt already existing primary schools have become operational. Over 17,000 government primary schools with the aim to improve their underprivileged children have been enrolled, of which 48 overall performance and functioning, following the same per cent are girls. curriculum philosophy and quality standards as their own primary schools. By the completion of Phase one, the Foundation aims to operationalize 236 primary schools reaching out to approxi- The schools, constructed by Bharti Foundation are designed mately 50,000 children across Punjab, Haryana, Rajasthan, to be cost effective, child and environment friendly. The Uttar Pradesh and Tamil Nadu. process; theywillbecomeoperationalshortly. senior secondaryandvocationaltrainingschoolsisin village uponcompletingtheirschooling.Establishmentof to childrenhelpthemgainemploymentwithintheirown these schoolswillprovidevocationaltrainingopportunities Bharti PrimarySchools.Inadditiontoregularacademics, public-private partnershipmode,overaclusterof8-10Satya set uponeSatyaBhartiSeniorSecondarySchool,in children ofitsprimaryschools,BhartiFoundationplansto To ensurecontinuousaccesstoqualityeducationfor Satya BhartiSeniorSecondarySchoolProgram 27 BHARTI AIRTEL ANNUAL REPORT 2008-09

“ tion betweenresearchandusergroups. nication theoryandsystemsfosterstechnicalcollabora- during theyearstrivesforexcellenceinresearchcommu- at theUniversityofCambridge, Fellowship Program. promote researchandexcellenceinPublicPolicy. Indian SchoolofBusiness(ISB)campusinMohali,Punjabto pursuing othercourses. art facilitiesnotonlytoitsownscholarsbutalso indirectly. TheSchoolextendsaccesstoitsstate-of-the- Every year,theschoolimpacts200studentsdirectlyor young peopletodevelopfutureleadersandentrepreneurs. education andtrainingopportunitiestoacademicallybright maintenance forundergraduatestudyinanysubjectatofthecollegesthatarepartUniversityCambridge. Bharti Foundationhasalsomadeasubstantialcontributiontothe component oftheprogram. peer handholding(byseniorfellowsofpreviousyears)andmentoringbyinterestedindividualsfromcivilsocietyformastrong education andvocationaltrainingcourses.Periodicworkshopsontopicslikecareercounselingpersonalitydevelopment, The Foundationalsosupports40underprivilegedgirlsthroughtheScholarshipProgramunder supports 224scholarsin38premierinstitutionsofhighereducationacross26states. program hasexpandeditsscopeandcoveragetoincludestudentsfrommoreregionsdisciplines.Todaythe higher educationinmanagement,engineering(electronics,telecomandsoftware)agriculture.Eversinceitsinceptionthe sit onthecomputer everyday.” a computerandmy letme teachers I love going toschoolbecauseithas Bharti InstituteofPublicPolicy Bharti CentreforCommunicationinIIT,Mumbai, Management, IIT,Delhi, Bharti SchoolofTelecommunicationTechnologyand training intheareaoftechnologyandmanagement. in thecountrytofurthercauseofhighereducationand Bharti Foundationhasjoinedhandswithpremierinstitutes Excellence Building Centresof Bharti ScholarshipandMentorshipProgram and Mentorship Support TalenttoBloom–Scholarships Other educationalprograms Student, Satya Bharti School,Ladhowal Student,Satya Bharti - Sukhjeet Thisscholarshipextendssupporttoonlygirlstudentsfromunderprivilegedbackgroundpursuehigher operationalsince2006provides

will beestablishedatthe

as oneofitspromoters.TheProgramprovidesfullfunding,coveringfeesandmeans–tested aimstohelpacademicallybrightstudentswithlimitedfinancialmeanspursue

launched Dr. ManmohanSinghUndergraduateScholarshipProgram Bharti SchoolPrograminthefuture. to reachoutmorethan200,000childrenthroughitsSatya 150,000 childrenandyouthsofar.TheFoundationexpects programs havedirectlyandindirectlyimpactedmorethan extended theambitofitsprogramstonewareas.Its Over theyears,BhartiFoundationhassuccessfully Program, The Foundationhasalsosupportedthe to childrenintheruralpocketsofcountry. these centresaimtomakebooksandtechnologyaccessible and Adarshila.Presentlybeingrunasindependentunits, ship withotherNGOslikePratham,Infotech,KalakarTrust Activity CentresweresetupbytheFoundationinpartner- 26 BhartiComputerCentresand104Library few years. initiatives inthefieldofprimaryeducationoverlast Bharti Foundationhasalsosupportedandfacilitatedseveral Other initiatives inpartnershipwithAkshayaPatra. Bharti UdayanShalini Mid-Day Meal

29 BHARTI AIRTEL ANNUAL REPORT 2008-09 10 Corporate Social Responsibility

Besides initiatives in the focus area of education, we undertook several other measures in the areas of health, environment, and disaster management support. The involvement of large numbers of employees across businesses was particularly heartening.

Public Health

We firmly believe that mobile telephony empowers users to connect with each other in unheard of ways to overcome difficult situations. We have discovered a novel way of extending our spirit of innovation in the area of blood donation by finding a mode to connect the blood banks with donors and users. Mobility Tamil Nadu extended its association with Jeevan Blood Bank in Chennai under its ‘Airtel Cares for Everyone’ (ACE) project. This first of its kind initiative enables people to get information on availability of blood within minutes and access the real time stock of tested blood components from Jeevan Blood Bank 24 hours a day. Airtel already has a partnership with Jeevan, in which a few numbers have been provided free of cost for Jeevan to stay in touch with people wanting to donate blood and patients in need of blood. Mobility Karnataka too launched a virtual blood bank to bridge the gap between donor and recipients.

Like in previous years, circle organizations regularly organized blood donation camps in association with Rotary blood bank, Lions blood bank and International Red Cross to encourage employees to donate blood.

We also worked towards creating awareness about different diseases and their preventive measures among employees. Rural Empowerment

Our rapid rural penetration enables us to impact lives in India’s far flung villages. Our connections have turned out to be key catalysts in the rural areas both in terms of economic productivity and governance.

The E-Gram project initiated last year has already made a huge transformational impact in rural Gujarat, as citizens no longer have to travel long distances to get routine official work done. The initiative has truly carried the government to the villager’s doorstep. We are determined to help initiate many such e-governance initiatives in the future as well.

Impact of our business on the rural economy has been quite profound. We have successfully connected the rural farmers, the artisans and the small entrepreneurs to their markets, raising their incomes substantially. During the year we launched a path-breaking project in the shape of our joint venture with IFFCO – IFFCO Kisan Sanchar Limited (IKSL). IKSL is making a discernible impact on agricultural productivity through its timely information offerings in the area of weather forecast, commodity rates and farming techniques. To ensure rapid dissemination of the services we are also providing affordable handsets to the farmers. initiative forvisuallychallengedchildrenbyCSRvolunteers own livesandtothesociety.“GiftASmile”wasonemore risen abovetheirdisabilitiestomakeadifference funfair tocheertheexemplaryspiritofindividualswhohave voluntary organizationonWorldDisabilityDaytoorganizea Like lastyearMobilityTamilNadujoinedhandswithalocal Bihu there. too visitedanorphanageandoldagehometocelebrate Nilaya’, anorphanageforgirls.EmployeesofMobilityNESA (Karnataka) celebratedDiwaliwithchildrenat‘Prashanth in orphanagesandoldagehomes.AirtelTeamMangalore undertook severalinitiativestobringsmilespeopleliving Employees inMobilityKarnatakaandAssam Children’s Village. paintings. AllcollectionsfromthisweredonatedtotheSOS the employeesconductedacharityauctionofchildren’s singing andpaintingcompetition.AttheTNGHeadOffice, with them.Theyengagedthechildrenunfilledgames, and giftsforthestudentssharedsomewarmmoments On Children’sDaytheyvisitednearbyschoolswithgoodies handful ofwhicharepresentedhere: year, severalinitiativeswereundertakenbyemployees,a the pooranddeprivedsectionsofsociety.Through always beenkeentoextendahelpinghandchildrenfrom Employees acrossbusinessesandcircleorganizationshave and vulnerable andinspiretheyoung Support for educationofthevisionimpaired. from itsscrapsaletoShruti,anNGOfocusedoneducation Haryana. EverymonthTelemediaNorthdonatesproceeds the statesofGujarat,Bihar,Assam,ArunachalPradeshand privileged communitiesinslums/ruralareasofDelhiand and deprivedchildren,youthwomenfromunder- deeply committedtothecauseofneglected,disadvantaged and non-governmentalorganizations.Theorganizationis (University ofDelhi),andvariousgovernmental,bilateral with theDelhiPolice,SchoolofSocialWork voluntary organization(NGO)functioningincollaboration Telemedia NorthhubhasadoptedPrayas,anationallevel were organizedfollowedbyaPrizeDistributionceremony. & PaintingCompetition,PoetryRecitationandStorytelling life morepositively.Variousfun-filledactivitieslikeDancing to understandtheirdisabilityandinspirethemlookat for takingcareandgroomingthevisuallyimpairedchildren visited NationalAssociationfortheBlind(NAB),aschool of BhartiAirtel–TransportNationalGroup.Thevolunteers 31 BHARTI AIRTEL ANNUAL REPORT 2008-09 Think Green

Bharti Airtel believes in the philosophy of 4Rs - refuse, reduce, reuse and recycle. The philosophy extends to all our acts in our offices and on our sites. We have stepped up our efforts towards energy conservation by sharing infrastructure, using technology aids like video conferencing to reduced travel and deploying green shelters. At our offices, we have deployed waste water recycling, energy efficient lighting, the concept Bharti Airtel is the first company to apply for carbon credits of the energy wheel, air curtains on major office exits and by implementing energy efficiency power interface units disposal mechanisms for discarded oil. We have also teamed and back-up cooling systems in BTS. Energy councils were up with global majors to form teams focusing on energy set up across the businesses to implement energy optimization by way of introducing energy-efficient equipment efficient initiatives. and exploring alternate energy sources like solar, wind, bio-fuel / hydrogen etc. to reduce the environmental impact. The World Environment Day was celebrated with much enthusiasm across circle organizations. ‘Each one Plant Green Shelters at cell sites has reduced operational costs by one’, a campaign launched by Mobility Tamil Nadu symbol- as much as 40% as compared to conventional shelters. Airtel ized employee commitment to the cause. In Mobility has saved over 75mn liters of diesel and over 400mn KWH of Gujarat employees celebrated by wearing green, and energy on an annualized basis, translating into approx. adopted car pooling to minimize pollution. US$ 100mn in energy savings alone. Carbon emission has reduced by over 500,000 mt annually by deploying green We have automated many of our HR processes through an shelters at all our sites across India. innovative technology program called e-tize. Airtel employees conduct their day-to-day work through this As an environment conscious organization, Bharti Airtel comprehensive automation journey, touching all core constantly explores all possibilities to control energy domains; Learning and development, Leave management, consumption and reduce green house gases on priority basis. Compensation management, expense management and We have set up dedicated teams to deal with energy travel management. All this have reduced employee efficiency and renewable energy. The teams are led by top interface processes to the click of a button, significantly management, which shows the commitment to the cause. improving employee motivation and comfort. There is a constant endeavor to install the latest energy efficient equipment and control systems in all facilities such Alongside a dramatic transformation in work processes, as BTSes, data centers and MSCs. Applications of renewable e-tize delivers equally powerful dividends in terms of and alternate energy are being taken up to install solar hybrid environment friendliness. Employee touch point automation towers for BTSes, use of alternate fuels to operate DG sets, initiatives manage to save approx 600,000 sheets of paper obtaining wind energy for the bulk consuming loads. every year.

Airtel follows WEEE norms to dispose of end-of-life electronic equipment enabling responsible recycling. of naturaldisasters. will openthedoorformanysuchinitiativesacrosscountry,whichhasatopographicaldiversitythatexposesittovarie - Muzaffarpur,Vaishali,SamastipurandDarbhangainJuly2008.Westronglybelievethesuccessofthisearlywarningsystem in fromsatellites.ThisnovelapproachfollowsencouragingresultsapilotprojectweundertookfourdistrictsofBih status ofembankmentstotheinstitute,whileMITwillanalyzethisdatabysupercomputersvis-à-visotherreferencesdrawn in advance.Undertheagreement,wewillprovidedataaboutwater-levelsofvariousriversatdifferentpointsand hands withMassachusettsInstituteofTechnology(MIT)todevelopanearlywarningsystempredictfloodsatleast15days Natural disastersarealwaysbetterhandledwithanearlywarningsysteminplace.WiththismindBhartiAirtelhasjoined of Rs.30mntothePrimeMinister’sReliefFundforsupportinggovernment’sreliefworkinfloodaffectedareas. collection drivetoraisesubstantialamountsofreliefmaterialsforthefloodvictims.BhartiFoundationmadeacontribution financial contributionsanddonationofreliefmaterials.Employeesincircleorganizationsbusinessunitswentona responsible corporateBhartiAirtelanditsemployeesrosetotheoccasionsupportfloodvictimsbothintermsof During theyearstateslikeBihar,Bengal,OrissaandAssamfacedseveralnaturalcalamitiesinshapeoffloods.Asa Disaster Relief ar ty 33 BHARTI AIRTEL ANNUAL REPORT 2008-09 10 Corporate Social Responsibility

Innovation and Entrepreneurship- Rekindle the spirit

Innovation and entrepreneurship have been at the core of Bharti Airtel’s phenomenal market penetration and growth. It has always been our desire to spread this spirit to the wider society. The Company therefore launched the ‘Airtel Innovation Fund’ aimed at promoting innovation and entrepreneurship in the field of telecommunications. The objective of the first such Funds in telecom is to provide opportunities to entrepreneurs with a vision to build businesses based on innovative ideas. The Fund has an initial corpus of Rs. 2bn and will be led and administered by Bharti Airtel.

Sporty ways - Ensuring a Cultural Connect – Be one with healthy future India’s diversity

Promoting a sporting culture and developing a keen aware- Over the years Bharti Airtel has carved out an enduring ness about healthy living is a priority for us. Through the relationship with India’s hugely diversified culture. We year, it has been our consistent endeavor to promote such a have built this relationship by diligently investing in popular culture both within the organization and outside. cultural events in different regions of the country. These relationships continued through the year, be it the famous Airtel Delhi Half Marathon was our biggest initiative on this Dahi handi festival in Maharashtra or for that matter the very front. The mega event enabled Delhi’s young and old to rub popular boat races in the Kerala backwaters. shoulders with professional marathoners on Delhi roads to rediscover the joys of running. The event was a rousing Circle organizations have been actively promoting local success, in which more than 30,000 participated. We are music and dance festivals. Mobility Orissa continued its certainly going to continue our association with this premier association with the state’s premier annual cultural show, event in future. the Konark Dance & Music Festival. The festival helps connect the wider public to the rich cultural tradition of To enhance employee involvement in sports, Airtel Centre the state. Mobility NESA supported the annual Kameswari and circle organizations continued organizing internal sports Dance Festival, where noted classical dancers and singers events through the year. Like last year, the Airtel 20:20 from across the country participated. Cricket Cup was a grand success, in which all the circle organizations and the businesses participated with Another association that we are extremely proud of is our much enthusiasm. support for Habba, Bengalooru’s biggest cultural festival celebrating the spirit of the city. The annual festival showcases every conceivable element of the region’s culture so successfully starting from music, dance, fashion to craftsmanship.

Bharti Airtel’s continuous support to these events have kept the country’s rich cultural roots fresh in the public mind. Many struggling art forms have received a new lease of life because of our associations with them. “ we were reminded of our B.Ed days.”we were remindedof lessonplanningandwhile doingso practice of unsociable citizen? We enjoyed thehands-on we teachGforGuntoachildmake himan we know thatwe canteachGforGodwhy should achild.If impact onthetendermindof a great ourselves. Now we know how asmallthingleaves The traininghashelpedusknow moreabout society directly. and goalstomakeamoredeeprootedimpactonthe we willalwaysbekeentoalignourbusinessprocesses continue tobetheprincipalchannelforourCSRinitiatives, through ourCSRinitiatives.WhileBhartiFoundationwill transformational changesinthesocio-economiclandscape determined totranscendourbusinessarenatriggerbig impact onthequalityoflifearoundus,weremainequally try toalignourbusinessprioritiesmakeanincremental us tobemoreambitiousinthesocialarena.Evenaswe Bharti Airtel’ssuccessasabusinessentityonlyinspires in theiracademics. are actingasmentorstothesechildrenandassistingthem educational trackrecords.OtheremployeesfromBangalore related expensesfor18girlstudentswithexcellentpast Educational Foundationtosponsortheeducationandits Employees inthecirclealsojoinedhandswithPragati support thecause. The Companywillbemakingamatchingcontributionto for variousBhartiACTinitiativesthroughtheportal. (ranging fromRs.50to250)overthenext12months all theteammemberswillbedonatingarecurringamount 2009 withamessageof“WECARE”.UndertheProgram Mobility Karnataka’sinstitutionalteamdecidedtowelcome policy ofofferingoneday’spaidleavetoallemployees. volunteering onalargerscale,BhartiAirtelcontinuesits Satya BhartiSchools.Tofacilitateemployee stationery andteachingmaterialstothestudentsofnearby businesses andcircleorganizationshaveregularlydonated choice empanelledinACT.Employeesacrossour Foundation oranyothercharitableorganizationoftheir skills, knowledge,materialsandmoneytoeitherBharti encourages allBhartiGroupemployeestocontributetime, ACT isanemployeephilanthropyprogrammethat ACT –ACaringTouch Teacher, School,Ladhowal Satya Bharti Singh - Raghveer 35 BHARTI AIRTEL ANNUAL REPORT 2008-09 11 Awards & Honours

Bharti Airtel was given many awards during the year. • Airtel won the Platinum Trusted Brand Award in the Some of these awards are listed below: Mobile Service provider category in the Reader’s Digest Asia Trusted Brands Survey • At the Telecom Asia Awards 2008 we received the Best Carrier India Award for innovative products and services • Bharti Airtel had the distinction of being amongst 20 and efficient cost models. We also received the Ovum companies worldwide and the only one in India, to be Telco-Transformation Award, for the philosophy and honoured with the ‘Gallup Great Workplace Award’ execution of our outsourcing strategy • Airtel was honoured with the prestigious Wireless Service • Retailer of the Year - Telecom Services Award at the Asia Provider of the Year Award at the 2008 Frost & Sullivan Retail Congress 2009 in Mumbai Asia Pacific ICT Awards

• Best Mobile Music, TV or Video Service Award at the • Airtel was voted as the Best ISP in the PC World GSMA Asia Mobile Award 2008, for creating a uniquely Broadband Survey conducted by PC World - one of India’s intuitive, personalized user experience of music on mobile leading technology magazines published by IDG with our Music-on-Demand service • IDG India’s CIO magazine recognized us as a recipient of • From the World Communication Awards 2008 we went a 2008 CIO 100 Award. We were also one of the five home with 3 awards: Best Content Service Award, Best recipients of the Special 2008 CIO Security Award Project Management Award and the Airtel-IFFCO Farmer Information Dissemination Platform project was awarded • Appreciation award for significant contribution towards the ‘Best Content Service Award’ Service tax (2008) – Department of Customs and Central Excise (Delhi Range), Govt of India • At the 7th Frost & Sullivan ICT Awards 2008 we were honoured with Market Leadership awards in the ‘Large • Buzziest Brands of the Year 2009 – agencyfaqs Enterprise Telecom Services’, ‘Wholesale Data Services’ and ‘Mobile Services’ categories • Ranked 3rd among India’s 500 most valuable companies; Ranked 2nd among Top 500 profit earners; Among India’s • Airtel digital TV was rated as the number 1 DTH operator Best Marketers - Business Today 2008 in the country by Living Digital magazine, the largest specialty media house in South Asia and amongst India’s • Among 50 Best listed companies in Asia Pacific - top five magazine publishers Forbes 2008

• We were adjudged the winner of the Nasscom-CNBC TV • Ranked 21 among Best performing IT companies in the 18 IT User Award 2008 for the Telecom vertical world - 2008 Business Week IT 100

• Jointly with our partner IBM we won the Technology • Best Project Management Award for our Gujarat e-GRAM Managers Forum 2008 Best Practice Awards programme project - World Communications Awards 2008 in the Business Process Improvement category for our e-tize project • World’s 25 Most valuable Telecom Brands; Ranked 8th among Top 50 most valuable (company) brands - Brand • We were voted as the ‘Best Cellular Service Provider’ and Finance Plc 2008 ‘Best Broadband Service Provider’ at the 2008 Voice & Data 100 Awards • Ranked among 50 largest and most liquid companies in BRIC countries - Dow Jones BRIC 50 2008 • In a survey conducted by The Wall Street Journal to determine Asia’s 200 most-admired companies Bharti Airtel • ‘Most Admired Organization’, ‘Best National Mobile was voted India’s most innovative company Operator’, ‘Best Internet and Broadband Operator’, ‘Best Ad Campaign’ – Telecom Operator Awards 2008 • Airtel was voted the 2nd Most Trusted Service Brand in the Annual Economic Times-Brand Equity, Most Trusted • Best Telecom Company – NDTV Profit Business Awards Brands survey tojointheBoardofthisglobalthinktank. forInternationalPeace.SunilMittalisthefirstIndian • JoinedtheBoardofTrusteesCarnegieEndowment municationUnion(ITU),firstIndiantojointheBoard • JoinedtheTelecomBoardofInternationalTelecom- Awards,2008 • ‘TelecomPersonoftheYear’-Tele.netTelecomOperator • GSMAChairman’sAward,2008-GSMAssociation contributiontoIndianbusiness prestigiousawardrecognizeshisentrepreneurialzealand • U.S.-IndiaBusinessCouncil’sGlobalVisionAward.This NDTVProfitBusinessAwards •BusinessLeaderTransformingIndiaAward2008atthe distinctions: presented withthefollowingpersonalawardsand Sunil BhartiMittal–ChairmanandManagingDirectorwas

2008 AwardWinner GALLUP GREATWORKPLACE Business LeadershipAward,2008 NDTV PROFITAWARD The Buzziestbrandoftheyear BUZZY GOLD2009AIRTEL 37 BHARTI AIRTEL ANNUAL REPORT 2008-09 When a gifted team dedicates itself to unselﬁ sh trust and combines instinct with boldness and effort, it is ready to climb.”

- Patanjali 1 DirectorReport 39-67.p65 12 • • • • • • • • • Some ofthekeyhighlightsincludefollowing: total telecomsubscribers. largest integratedtelecomcompanyinIndiabasedon achieved variousaccomplishmentsandbecamethe During thefinancialyear2008-09,Company services inIndia. Towers arethetwotopprovidersofpassiveinfrastructure 42% ofIndusTowersLimited.BhartiInfrateland its subsidiaryBhartiInfratelLimited.owns infrastructure pertainingtotelecomoperationsunder Company alsodeploys,ownsandmanages passive The distance connectivitybothnationallyandinternationally. enterprise customers,inadditiontoprovidinglong also offersanintegratedsuiteoftelecomsolutionsto broadband accessdeliveredthroughDSL.TheCompany mn useTelemediaServiceseitherforvoiceand/or of whom93.9mnsubscribetoGSMservicesand2.7 aggregate of96.6mncustomersasMarch31,2009; in India,andSriLanka.TheCompanyservedan licensed jurisdictions(alsoknownasTelecomCircles) telecommunication serviceswithpresenceinallthe22 Bharti AirtelisoneofAsia’sleadingproviders Overview 2009. March 31, accounts fortheyearended Company togetherwithauditedfinancialstatementsand annual reportonthebusinessandoperationsof Your directorshavepleasureinpresentingthefourteenth Dear Shareholders, Directors’ report Directors’ TV, itsDirect-to-Home(DTH) satelliteTVservice Made itstelevisiondebutby launchingAirtelDigital 3.5G network mobile operationsinSriLankaonastate-of-the-art Expanded itsinternationalfootprintbylaunching the lowestinworld has ledtomobiletariffsof1.2cents/minute,one Focus onruralpenetrationandcustomeraffordability population thus coveringapproximately81%ofthecountry’s and 414,906non-censustownsvillagesinIndia, Mobile Networkispresentin5060censustowns 23% increaseinnetprofit by 50%resultedin38%increaserevenuesand Year on(Y-o-Y)growthoftotalcustomerbase Full yearconsolidatednetprofitofRs79bn and consolidatedEBITDAofRs153bn Full yearconsolidatedgrossrevenueofRs374bn in ayear Highest netadditionof31.93mntotalcustomers base of96mn First operatorinIndiatocrossthetotalcustomer 39 Operations oftheCompany(legalentity) Financial highlightsofStandaloneStatement Operations oftheCompany Financial highlightsofConsolidatedStatement OPERATIONS FINANCIAL RESULTSANDOF • proposed tobetransferred theGeneralReserve. year 2008-2009,anamount ofRs.6,000mnis Out oftotalprofitRs.77,438 mnforthefinancial TRANSFER TORESERVE instruments. schemes, FixedMaturityPlansandothersimilar Certificates ofDeposits,LiquidandIncomeDebtFund Market instrumentsincludingBankFixedDeposits& returns viainvestmentsmadeinDebtandMoney manages itsshort-termliquiditytogenerateoptimum securities ofRs.23,422mn.TheCompanyactively bank balanceofRs.27,660mnandmarketable As onMarch31,2009,theCompanyhascashand assets. by minimizingtheamountoffundstiedupincurrent optimize financecostandgeneratefundsforexpansion and itsdeployment.TheCompanyhasbeenableto management systemtoensuretimelyavailabilityoffunds and financialinstitutionsoperatesarobustcash creditors andsufficientstandbycreditlineswithbanks having suitablecommercialarrangementwithits The Companymeetsitsworkingcapitalrequirementby LIQUIDITY ahpoi rm135,769 taxation Earnings before operations Cash profitfrom e rft(os 8506,5 23% 63,954 78,590 Net profit/(loss) EBITDA Gross revenue Particulars e rft(os 7486,4 24% 62,442 77,438 32% Net profit/(loss) 257,035 taxation 340,143 Earnings before operations Cash profitfrom EBITDA Gross revenue Particulars in NCRunderaunifiedbrand“Airtel” interactive –itsInternetProtocolTelevisionService Debuted TriplePlayservicewithAirteldigitalTV 7/22/2009, 8:06 PM (Amount inRs.mn,exceptpercentages) (Amount inRs.mn,exceptpercentages) 1Mr0 1Mr0 Growth 31-Mar-08 31-Mar-09 1Mr0 1Mr0 Growth 31-Mar-08 31-Mar-09 152,858 7,2 270 373,521 131,918 115,686 81,615 5907,1 17% 73,115 85,910 Year ended Year ended 0,4 23% 106,848 0,6 11% 104,369 1,1 34% 114,018 1,3 22% 111,535 97517% 69,725 1238% ,122 Y-o-Y Y-o-Y 39 BHARTI AIRTEL ANNUAL REPORT 2008-09 DIVIDEND by reputed external assessors. Our ISO27001 implementation is amongst the largest globally, and our Your Board of directors in its board meeting dated 29th ongoing BS25999-compliant BCP implementation is April, 2009, has recommended a final dividend of Rs. 2 amongst the largest in Asia. Airtel is TL9000 and PCI per equity share of Rs. 10 each (20% of face value) for DSS compliant, and its IT infrastructure and processes the financial year 2008-09. The total dividend payout will amount to Rs. 4,442 mn, including Rs. 645 mn as are compliant with COBIT and ITIL best practices. We tax on dividend. The payment of dividend is subject to are also implementing SAS 70 across the BPO partners. the approval of the shareholders in the ensuing Annual BRANDING General Meeting of the Company. Brand Airtel moved closer to its vision to be the most SUBSIDIARY COMPANIES admired brand by 2010. Airtel sustained its momentum Your Company has the following fourteen subsidiary in the telecom space by getting closer to the 100 mn companies (i) Bharti Hexacom Limited (ii) Bharti Airtel subscriber milestone and extended the brand to TV Services Limited (iii) Bharti Telemedia Limited (iv) Bharti screens by launching DTH TV services and IPTV. Infratel Limited (v) Bharti Infratel Ventures Limited (vi) For the mobility vertical, the over-arching brand Bharti Airtel (UK) Limited (vii) Bharti Airtel (USA) Limited philosophy focused on strengthening the brand’s (viii) Bharti Airtel (Canada) Limited (ix) Bharti Airtel perception as a trustworthy service leader. A segmented (Hongkong) Limited (x) Bharti Airtel (Singapore) Private approach stretched the brand’s relevance across socio- Limited (xi) Bharti Airtel Lanka (Private) Limited (xii) Bharti economic segments of over 300 mn mobile users in the Airtel Holdings (Singapore) Pte. Limited (xiii) Network i2i country. Limited (xiv) Bharti Infratel Lanka (Private) Limited. The business’s rural thrust was supported by network As per Section 212(1) of the Companies Act, 1956, and handset bundle campaigns to drive acquisition the Company is required to attach to its accounts the amongst non-users. The rural network campaign Directors’ Report, Balance Sheet and Profit and Loss positioned the role of the ubiquitous Airtel network as Account etc. of each of its subsidiaries. As the that of a radar that allowed the rural youth to discover consolidated accounts present a complete picture of their aspirations that stretched beyond their villages, the financial results of the Company and its subsidiaries, while simultaneously being in touch with their near ones the Company had applied to the Central Government back home. seeking exemption from attaching the documents referred to in Section 212(1). In terms of approval Low cost handset bundles (Airtel connection with entry- granted by the Central Government under Section level handsets) were promoted through a national 212(8) of the Companies Act, 1956 vide letter No. 47/ campaign supported by on-ground roll-out of 212/2009-CL-III dated 30-03-2009, a copy of the demonstration vans in the rural hinterland. The on-air Balance Sheet, Profit and Loss Account, Reports of the campaign focused on the need for owning a handset Board of directors and Auditors of the subsisting bundle and the on-ground vans focused on driving subsidiaries for the year ended March 31, 2009 have activation through live demos and activation offers in not been attached with the Balance Sheet of the village haats and melas. For the urban centers, the Company. The Annual Accounts of these subsidiary brand’s belief in a barrier free world was extended to an companies, along with the related information, is on-ground manifestation through the ownership of the available for inspection at the Company’s registered Airtel Delhi Half Marathon. This brand asset office and copies will be made available to Bharti Airtel’s strengthened the brand’s iconic leadership stature. investors and subsidiary companies investors upon request. The statement pursuant to the approval under Airtel’s mCommerce solution which won an award for Section 212(8) of the Companies Act, 1956, is annexed simplicity of use and inbuilt security features at the GSM as parts of the Notes to Consolidated Accounts of the World Mobile Congress, was launched using impactful Company on page no. 191. communication that clearly focused on how this new service makes life simple. The service which transforms QUALITY your mobile phone into a payment device is now being Quality is at the core of everything we do at Airtel. It adopted by consumers at an accelerated pace. supports all internal functions in delivering to customer requirements through customer centric processes and Communication for value added services like Voice products. Continuous improvement and innovation is Search for Hello Tunes and Voice SMS drove brand embraced throughout the Airtel ecosystem, fostered by affinity amongst the youth segment. a philosophy of getting it right the first time by driving Operations in Sri Lanka were launched with a high- issues to root cause and eliminating repeat problems. voltage launch campaign “Hello Sri Lanka” featuring We firmly believe quality begins with our employees Airtel’s brand ambassador Shahrukh Khan. This led to and continuously invest in their training and an unprecedented demand for application forms before development. A few initiatives which are ingrained in launch. The mega launch was followed by a series of the DNA of Airtel are lean six sigma, process tariff campaigns which changed the game in this market. standardization and variation reduction, six sigma plus Using the platform of ‘simplification’, Airtel managed and knowledge management. to reposition competition as complex and unfriendly We have a proven track record of pursuing quality towards the user. An unprecedented demand for Airtel management systems. Our processes have been connections was witnessed post these campaigns. The benchmarked with global best practices and standards, subscriber base is currently accelerating towards the with rigorous assessments regularly conducted on them 1million mark in record time.

1 Director Report 39-67.p65 40 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 • • innovation andtechnology: agreements relatingtooperations,customerservice, During theyear,Companysignedfollowingmajor Major agreementsandalliances HIGHLIGHTS OFTHEYEAR become anestablishedplayerintheDTHcategory. and inIndiawithinfourmonthsoflaunch,Airtelhad accolades fromthecountry’sprintanddigitalmedia The launchinSriLankagotextensivecoverageand “Brand withtheLongestBuzz(threeconsecutiveyears)”. elected Airtelasthe“BuzziestBrand2008”and the bestadvertiserforyear2008andagencyfaqs The EconomicTimes(BrandEquity)featuredAirtelas Airtel-Rajdhani Express. Marathon andtheSingaporeOutdoorAwardfor EFFIES Awards,WOWAwardfortheAirtelDelhiHalf industry accoladesincludingfourABBYAwards,two an all-timehigh.Theyearwasdottedwithmultiple By theendofyear,brandhealthscoresreached Advertisements inNDTV’s.AllaboutAds2008ranking. Magic” andwasrankedNo.3amongstBest was withcreativemanifestation-”ComeHometothe experience ateveryinteraction.The360degreelaunch engineers, etc.werealldetailedtoenrichthecustomer Care Services,dressandservicecodesforinstallation ensure thatcustomertouchpointsliketheCustomer of whichwerefirstsinIndia.Specialcarewastakento like UniversalRemote,Widgets,Radio-on-TV,etc.–all program guide,theuniqueanddifferentiatedfeatures box, theeasytonavigatemulti-lingualelectronic alive, beitthestylishandpremiumlookofset-top experience werecarefullyevolvedtobringthe‘magic’ The marketingmixof‘digitalTV’,productdesignand experience –anddefinedas‘magicalentertainment’. proposition wasbasedondramatizingtheTVviewing relevance anddrivingacquisition.Thebrand’sunique disruptive yetstrongmessagewasdevelopedforbuilding environment andstronglyentrenchedcompetition,a proposition. Giventherathernoisyadvertising category withadifferentiatedandrelevantcustomer marked anentryintothenascentbutfast-growingDTH across mobilephones,computersandTVscreens.Airtel our “threescreens”strategy,whichistobepresent beyond thetelecombusinessandisculminationof strategic viewofexpandingourportfolioservices Airtel’s forayintheDTHsegmentcomeswith country 11 languagestoeliteAirtel customersacrossthe the firstyearfocusedonproviding servicesinover IBM Dakshexpectstohave over 700employeesin collections, andcustomerretention fromitscenters. office servicesincluding customerservice, services unitIBMDakshwillprovidevoiceandback- the six-yearcontract,IBM’smanagedbusiness through processandtechnologyinnovation.Under experience foritstop-endPlatinumcustomers With software major’scontractinIndia operations inSriLanka,whichisanextensionofthe Lanka. IBMwillprovideITsupportforBharti’s With IBM IBM , tohandleBharti’sITrequirementsinSri

Daksh, 41 toenhanceitscustomerservice • • • • • • • and Compaqnotebookdesktop connection atdiscountedentrycostwitheveryHP partnership, Airtelwillofferconsumersabroadband and personalcomputers.Underthescopeof the agreement,BhartiAirtel andVirtelahave (Points ofPresence)across 190countries.Under connectivity outsideofIndiato morethan5000PoPs significantly enhanceitsinternational managedMPLS With digital lifestyletoAirtelTVcustomers applications thatwillfocusonprovidinganenhanced devices, applicationserversandinteractive Infosys willprovideasuiteofproductsincluding service. AspartofitsDigitalConvergencePlatform, Airtel digitalTV,it’sDirect-To-Home(DTH)TV superior customerexperiencetothecustomersof With in India partnership forbroadbandandtelephoneservices Alcatel-Lucent. ThisisthefirstManagedServices formed whichwillbemanagedandcontrolledby network acrossIndia.Anewlegalentityisbeing and manageBhartiAirtel’sbroadbandtelephone Alcatel-Lucent willdesign,plan,deploy,optimize business customers.UndertheJointVenture, VPN (VirtualPrivateNetwork)forbothretailand Services), MPLS(MultiProtocolLabelSwitching), internet, TriplePlay,media-richVAS(ValueAdded Networks toofferadvancedserviceslikehigh-speed and helpAirtel’stransitiontoNextGeneration Airtel’s pan-Indiabroadbandandtelephoneservices With With With users performance forbusinessprofessionalsandpower the worldprovidingsuperiorfunctionalityand support tri-bandHSDPAhighspeednetworksaround smartphone isthefirstBlackberryto for itscustomersinIndia.TheBlackberryBold Bharti AirtelandRIMintroducedthe With users reallife-likeexperience Hi-Definition videoconferencingservices,whichgive recognizes AirtelMPLSnetworkforrunning Telepresence Connectioncapabilities,which also obtainedacertificationfromCiscofortheir enterprise classMPLSservicecapabilities.Airtelhas are endorsedforcarrierclassMPLSnetworksand places itinaleagueofselectglobaloperatorsthat status underCISCOMSCPProgram.Thecertification Managed Multi-ProtocolLayerSwitchingProvider Pacific AmericanCoalition)toachieveCiscoPowered become thefirstserviceproviderinAPAC(Asia Private Network)services.WiththisAirtelhas capabilities, toprovideManagedMPLSVPN(Virtual certification fromCiscofortheirnetworkandservice 1 MSCP(ManagedServicesChannelProgram) Layer Switching)Service.ThelaunchincludesaTier generation iPhone with 3Gnetworkingthatistwiceasfastthefirst 3G combines alltherevolutionaryfeaturesofiPhone HP Infosys TechnologiesLimited Cisco Apple Inc. Alcatel-Lucent, Virtela , topromotethepenetrationofbroadband 7/21/2009, 9:23 PM ® tolaunchManagedMPLS(MultiProtocol signed astrategicagreement to tobringtheiPhoneIndia. aventuretomanageBharti (Infosys) todeliver Blackberry Bold iPhone 41 BHARTI AIRTEL ANNUAL REPORT 2008-09 integrated their networks through connection points • With Australia Japan Cable (AJC) to interconnect in South East Asia and Europe in order to expand their current and future networks in Guam. This Bharti’s MPLS based IP-VPN capabilities around the landmark agreement will allow both parties to offer world. Bharti Airtel will now be able to offer its services from a number of locations including Enterprise customers seamless managed MPLS Singapore and the USA West Coast to Australia. The connectivity and advanced managed network innovative agreement will utilize the undersea cable solutions to key business customers on a truly global assets of Bharti Airtel and AJC. The joint network is basis expected to carry commercial traffic by end of Q1 FY 09-10 • With Pacnet (region’s largest independent telecommunications service provider) for a Network • With asklaila, India’s first local information service, to Network Interface (NNI) agreement to enabling Airtel customers to get up-to-date interconnect their respective networks, expanding information about their city, free of cost, through connections to and from India. Under the asklaila’s extensive city information database. The agreement, the two companies will directly asklaila-powered ‘Airtel city search’ is accessible interconnect their network infrastructure to expand across six cities, including Delhi, Mumbai, Chennai, Hyderabad, Kolkata and Bangalore their respective MPLS based IP VPN capabilities and to provide advanced IP (Internet Protocol) New products/initiatives solutions to key business customers in the region. During the year, the Company launched various new The agreement will enable both companies to and innovative products and services in the market. This deliver greater coverage, seamless user experience enabled the company to strengthen its leadership and reliable technology to their customers. Airtel position despite intense competition. The following are and Pacnet have also announced a special key launches and initiatives for the year: “Gateway to India” offering for high capacity International Private Line circuits between the • The Company made its foray into media and United States and India television by redefining home entertainment with Airtel digital TV. The service is available to customers • With IFFCO to herald the second Green Revolution through 31,000 retail points including Airtel to benefit millions of rural consumers with a Joint Relationship Centres across the country venture company, IFFCO Kisan Sanchar Ltd (IKSL) that will harness the power of telecom to add value • Launched its virtual calling card service ‘Airtel Call to the farm sector and empower the rural farmer by Home’ in UK, Singapore and Canada. The service is giving him access to vital information, which will targeted at the huge Indian Diaspora, Non-Resident enhance his livelihood and quality of life. IKSL will Indians (NRIs) and Indian students in these markets offer products and services, specifically designed • Launched its mobile services in Sri Lanka under the for farmers, through IFFCO societies in villages across Airtel brand. The Company has launched a suite of the country. On offer are affordable mobile handsets innovative services and redefined affordability on a bundled with Airtel mobile connection and state-of-the-art 3.5G network. Bharti Airtel plans to customized value added services invest around USD 200 million in its Sri Lanka operations • With 15 global telecom majors to build Europe India Gateway (EIG), a cable system from India to United • Expanded the footprint by launching its Mobile Kingdom. Airtel is the only Indian service provider Services in Lakshadweep. Bharti Airtel is the first to be a part of this consortium, and will be operating private mobile service provider in the islands the cable landing station in Mumbai. The other • Launched Triple Play with Airtel digital TV interactive members of the EIG cable consortium include – Telephone, Broadband and TV on a single line. The AT&T, BT, C&W, Djibouti Telecom, Du, Triple Play Service is initially available to customers Gibtelecom, IAM, Libyan Telecom, MTN Group Ltd., in Delhi, Gurgaon and Noida. Airtel’s state-of-the- Omantel, PT Comunicações-S.A, Saudi Telecom art IPTV Head-end, with best-in-class MPEG4-10 Company, Telecom Egypt, Telkom SA Ltd, and compression technology, will allow it to offer more Verizon Business content and better quality images as well as services • With the country’s flagship oil company — Indian like live broadcast television, network based time- Oil Corporation (IOC) — that will enable Airtel to shifted TV, real video-on-demand and a host of other access 18,000 retail outlets and 5,500 Indane interactive services cooking gas distributors of the oil giant to take the • Pioneered 16 Mbps broadband thereby offering the mobile opportunity home to more customers. This fastest wireline broadband on DSL in the country. is an exclusive alliance between Airtel and IOC This service is powered by the Carrier Ethernet network and will be initially available in the cities of • With FirstSource Solutions (a leading global BPO Delhi NCR, Chennai and Bangalore with phased roll- services provider), a three-year outsourcing out to additional cities of Hyderabad, Pune, Mumbai agreement to provide a suite of BPO services covering and Kolkata both voice and back office in areas such as customer accounting, VAS (Value Added Services) provisioning, • Announced the launch of the world’s first Windows fraud & credit monitoring, customer service, based Online Desktop-powered by Microsoft and collections, customer retention to Airtel Nivio, giving access to a personal virtual desktop

1 Director Report 39-67.p65 42 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 Other companydevelopments • • • • • • • • an internationaltollfreenumber travelling abroad,tocommunicatewiththem,through customers, businesspartnersandemployees convenient andcosteffectivewaytotheiroverseas India. Theseservicesenableenterprisestooffera from Certification Program,Airtel hastheunique 29 certificatesawardedunder theISO27001:2005 employees inoperationalprocesses. Withatotalof customers andfurtherenhances theconfidenceof Airtel. Ithelpsbuildtrustand confidenceamongst quality informationsecurity environmentwithin (from BSI:BritishStandardsInstitute)ensuresahigh Organization. TheISO27001:2005certification Airtel isnowafully led andadministeredbyBhartiAirtel have aninitialcorpusofRs.200croresandwillbe businesses basedoninnovativeideas.TheFundwill opportunities toentrepreneurswithavisionbuild sector. TheobjectiveoftheFundistoprovide innovation fundinIndiaspecificallyforthetelecom field oftelecommunications.Thisisthefirstever at promotinginnovationandentrepreneurshipinthe Bharti Airtellaunched‘ Expanded With at Rs.1.50/minute outgoing localcallatRs.1/minuteandanSTD while roaming,Airtelcustomerscanmakean compared totheearlierRs.1.75/minute.Further, receive acallwhileroamingatRs.1/minute,as minute, thereductionsenabledAirtelcustomersto down toRs.1.50/minutefromtheearlier2.65/ services foritscustomers.WhileSTDratescame unprecedented tariffreductionsonSTDandRoaming Spelled “ customers’ onlineidentities enables organizationstostrengthenandprotecttheir of authenticationandfrauddetectionsolutionsthat with VeriSign.VIPServicesisacomprehensivesuite for itsEnterprisecustomersinIndiapartnership Launched competitive ratesinthemarket friends andfamilybackinIndiaatthemost This willenabletheIndiandiasporainUStocall online callingcardservicewww.airtelcallhome.com. Introduced the UAEandonlineatwww.ezetop.com recharge availableinover150moneyexchanges partnered withezetopInternationaltomakeprepaid ‘first’ intheIndiantelecommarket.Airtelhas Launched the country to allAirtelbroadbandcustomersacross95citiesin and broadbandinIndia.Thisservicewillbeavailable the wayforeasyandaffordableaccesstocomputing Airtel broadbandcustomers.Thisinitiativewillpave from anycomputerconnectedtotheinternetfor Airtel mobilefortheDelhiGurgaonExpressway mChek 80 countries VeriSign® IdentityProtection its Overseas RechargeService End ofDistance calling rateof1centperminute Premium InternationalTollFreeservices to offerthetolltagrecharge 43 for itsEnterprisecustomersin Airtel InnovationFund ISO 27001:2005Certified ” inIndiawith (VIP) Services , yetanother

through ’ aimed on its and S&P(international). institutions, CRISIL&ICRA(national)andFitchRatings Bharti AirtelLimitedhasoutstandingratingswithfour CAPITAL MARKETRATINGS report. forms partoftheManagementDiscussionandAnalysis Update onregulatoryandkeyindustrydevelopment REGULATORY ANDKEYINDUSTRYDEVELOPMENTS • to thesub-division ofshares. completing alltheprocedural formalitiestogiveeffect of Rs.5(Five)each.TheCompany isintheprocessof equityshares shares ofRs.10/-(Ten)each into2(Two) approved sub-division(share split)ofexistingequity approval ofitsshareholders, theBoardofdirectorshas In theBoardmeetingheldon April2009,subjecttothe 1,898,239,796 equitysharesasofMarch31,2009. increased from1,897,907,446(March31,2008)to issued, subscribedandpaid-upequitysharecapital (FCCBs). Duetothesecorporateactions,the conversion ofForeignCurrencyConvertibleBonds The Companyalsoallotted93,408equitysharesupon 2005 oftheCompany. shares onexerciseofstockoptionsunderESOPScheme During theyear,Companyissued238,942equity SHARE CAPITAL and growthoutlook the superiorfinancialstrengthandpositivebusiness they haveretained‘stableoutlook’forAirtelbackedby outlook byS&P,onarecentreviewofAirtel While India’scountryratinghasbeenputonanegative • • Services andwillreporttoManojKohli David NishballwillcontinueasPresident-Enterprise Atul andKSrinivaswillreporttoSanjayKapoor. will takeoverasJointPresident-TelemediaServices. Mobile Servicesandin-chargeofSriLankaoperations K SrinivaswhowasExecutiveDirector(East)– will takeoverasPresident–MobileServices. transformation attheTelemediabusiness,AtulBindal Sanjay willreporttoManojKohli.Havingledthe lead theMobile,TelemediaandDTHbusinesses. position ofDeputyCEO.Inhisnewrole,Sanjaywill President –MobileServicestoanewlycreated development. SanjayKapoorhasbeenelevatedfrom development, governanceandorganization Airtel willincreasinglyfocusonstrategy Manoj Kohli,CEO&JointManagingDirector,Bharti foundation fortheCompany’snextphaseofgrowth. organizational changes Bharti AirtelLimitedannouncedkeyapexlevel rating ofIndia(BBB-) S&P haveratedAirtelatthelevelofsovereign International ratingagencies,bothFitchRatingsand as welllongterm(AAA/LAAA) their ratingscales,bothforshortterm(P1+/A1+) CRISIL &ICRAhaveratedAirtelatthetopendof sectors andoneofthelargestinworld certificates toanysinglecompanyinIndiaacross distinction ofbeingawardedthelargestnumber 7/21/2009, 9:23 PM aimed atlayingthe 43 BHARTI AIRTEL ANNUAL REPORT 2008-09 CORPORATE GOVERNANCE A brief resume, nature of expertise, details of directorships held in other companies and shareholding The Company is committed to maintain the highest in the Company of the directors proposing appointment/ standards of corporate governance. The Directors re-appointment as stipulated under Clause 49 of the adhere to the requirements set out by the Securities Listing Agreement with the Stock Exchanges is appended and Exchange Board of India’s Corporate Governance as an annexure to the notice of ensuing annual general Practices and have implemented all the stipulations meeting. prescribed. FIXED DEPOSITS A detailed report on Corporate Governance pursuant to the requirements of Clause 49 of the Listing Agreement We have not accepted any fixed deposits and, as such, forms part of the Annual Report. A certificate from the no amount of principal or interest was outstanding as Auditors of the company, S.R. Batliboi & Associates, of the balance sheet date. Chartered Accountants, Gurgaon confirming compliance of conditions of Corporate Governance as stipulated AUDITORS under the previously mentioned Clause 49 is annexed The Statutory Auditors of the Company, M/s. S. R. to the Report as Annexure A. Batliboi & Associates, Chartered Accountants, Gurgaon, SECRETARIAL AUDIT REPORT retire at the conclusion of the ensuing annual general meeting of the Company and have confirmed their In keeping with the high standards of corporate willingness and eligibility for re-appointment and have governance adopted by the Company and also to ensure also confirmed that their re-appointment, if made, will proper compliance with the provisions of various be within the limits under Section 224(1B) of the corporate laws, the regulations and guidelines issued Companies Act, 1956. by the Securities and Exchange Board of India and the listing agreement, the Company has voluntarily started AUDITORS’ REPORT the practice of a Secretarial Audit from a practicing The Board has duly examined the statutory auditors’ company secretary. report to accounts and clarifications wherever necessary, The Company has appointed Mr. T. V. Narayanswamy, have been included in the Notes to Accounts section of Practicing Company Secretary, to conduct the the Annual Report. Secretarial Audit of the Company for the financial year As regards comments under para ix(a) of Annexure to ended March 31, 2009. He has submitted his report the Auditors’ Report regarding slight delay in a few confirming the compliance with all the applicable cases in deposition of statutory dues, the Company is provisions of various corporate laws. The Secretarial further strengthening its process to ensure that even Audit Report is provided separately in the Annual Report. such minor delays do not occur in future. CORPORATE SOCIAL RESPONSIBILITY As regards the comment under para xxi of Annexure to At Bharti Airtel, Corporate Social Responsibility (CSR) the Auditors’ Report, to address the issues of fraud by encompasses much more than social outreach programs employees and external parties, the Company has taken and is an integral part of the way the Company conducts appropriate steps including issuance of warning letters, its business. Detailed information on the initiatives of termination of service of the errant employees, the Company towards CSR activities is provided in the termination of the contract/agreements with the external Corporate Social Responsibility section of the Annual parties, legal action against the external parties involved Report. etc. The Company is further strengthening its internal control systems to reduce the probability of occurrence DIRECTORS of such events in future. Since the last Directors’ Report, Akhil Gupta relinquished ENERGY CONSERVATION, TECHNOLOGY the position of Joint Managing Director of the Company ABSORPTION AND FOREIGN EXCHANGE EARNINGS and continues to be a non-executive director on the AND OUTGO Board. Francis Heng and Kurt Hellstrom have resigned from the Board due to personal reasons. During the For the Company, being a service provider organization, year, Manoj Kohli was appointed as Joint Managing most of the information as required under Section Director of the Company. Quah Kung Yang, 217(1)(e) of the Companies Act, 1956, read with the Nikesh Arora and Craig Ehrlich were appointed as Companies (Disclosure of particulars in the report of additional directors. The Board places on record its sincere the Board of Directors) Rules, 1988, as amended is not appreciation for the services rendered by Francis Heng applicable. However, the information as applicable has and Kurt Hellstrom during their tenure on the Board. been given in Annexure A to this report. Ajay Lal, Akhil Gupta, Arun Bharat Ram and N. Kumar, EMPLOYEES STOCK OPTION PLAN retire by rotation at the forthcoming Annual General The Company values its human resource and is Meeting and, being eligible, offer themselves for re- committed to adopt the best HR practices. The appointment. employees of the Company are presently benefitted from The Company has received notice from a member under two ESOP Schemes under 2001 and 2005, Employee section 257 of the Companies Act, 1956 proposing the Stock Option Policy. The policy also helps in retention appointment of Quah Kung Yang, Nikesh Arora and Craig of well-performing employees, who are contributing to Ehrlich as non-executive directors of the Company. the growth of the Company.

1 Director Report 39-67.p65 44 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 (ii) i inthepreparationofannualaccounts forthe (i) belief confirmthat: 1956, thedirectorstobestoftheirknowledgeand Pursuant toSection217(2AA)oftheCompaniesAct, DIRECTORS’ RESPONSIBILITYSTATEMENT Annexure Dofthisreport. forms partofthisreportandhavebeensetoutas (Particulars ofEmployees)Rules,1975,asamended, the CompaniesAct,1956readwith Information aspertheprovisionsofSection217(2A) PARTICULARS OFEMPLOYEES at theregisteredofficeofCompany. and acopyofthesameshallbeavailableforinspection shareholders attheensuingAnnualGeneralMeeting, Stock Optionschemes,wouldbeplacedbeforethe to theimplementationofCompanyEmployee’s Chartered Accountants,StatutoryAuditors,withrespect A certificatefromM/sS.R.Batliboi&Associates, Annexure CtothisReport. Guidelines, 1999,asamended,areprovidedin Option SchemeandEmployeeStockPurchaseScheme) Securities andExchangeBoardofIndia(EmployeeStock Disclosure incompliancewithClause12ofthe prudent togiveatrueandfairviewofthestate judgments andestimatesthatarereasonable they haveselectedandappliedconsistentlymade proper explanationrelatingtomaterialdepartures; accounting standardshavebeenfollowedalongwith year ended31 45 st March2009,theapplicable forward totheircontinuedsupportinthefuture. shareholders fortheirsupportandcontribution.Welook Telecommunications Ltd.,andothervaluable various partnersviz.BhartiTelecom,Singapore Last butnottheleastdirectorswouldliketothank ensuring anexcellentallroundoperationalperformance. their continuingsupportandunstintingeffortsin extended totheCompanyandemployeesfor assistance, co-operationandencouragementthey Company’s Bankers,thebusinessassociates,for Central Government,theStateGovernmentsand to theDepartmentofTelecommunications(DOT), Your directorswishtoplaceonrecordtheirappreciation ACKNOWLEDGEMENTS Annual Report. presented inaseparatesectionformingpartofthe the ManagementDiscussionandAnalysisreportis In accordancewiththeListingAgreementrequirements, MANAGEMENT DISCUSSIONANDANALYSISREPORT havepreparedtheannualaccountsonagoing (iv)they theyhavetakenproperandsufficientcareforthe (iii) concern basis. other irregularities; Company andforpreventingdetectingfraud Act, 1956andforsafeguardingtheassetsof accordance withtheprovisionsofCompanies maintenance ofadequateaccountingrecordsin the year; financial yearandoftheprofitCompanyfor of affairstheCompanyasatend 7/21/2009, 9:23 PM 45 BHARTI AIRTEL ANNUAL REPORT 2008-09 Annexure A Auditors’ certificate regarding compliance of conditions of corporate governance

To In our opinion and to the best of our information and The Members of Bharti Airtel Limited according to the explanations given to us, we certify that the Company has in all material respects complied We have examined the compliance of conditions of with the conditions of Corporate Governance as Corporate Governance by Bharti Airtel Limited (“the stipulated in the above mentioned Listing Agreement. Company”), for the year ended March 31, 2009, as stipulated in Clause 49 of the Listing Agreement(s) of We state that such compliance is neither an assurance the said Company with stock exchange(s) in India. as to the future viability of the Company nor the efficiency or effectiveness with which the management The compliance of conditions of Corporate Governance has conducted the affairs of the Company. is the responsibility of the Company’s management. Our examination was carried out in accordance with the Guidance Note on Certification of Corporate Governance (as stipulated in Clause 49 of the Listing Agreement), issued by the Institute of Chartered Accountants of India For S.R. BATLIBOI & ASSOCIATES and was limited to procedures and implementation Chartered Accountants thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. per Prashant Singhal It is neither an audit nor an expression of opinion on the Place : Gurgaon Partner financial statements of the Company. Date : April 29, 2009 Membership No. : 93283

1 Director Report 39-67.p65 46 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 of theglobaltraffic. major cablesystemstoincreaseourpresenceandshare under-sea networksandwewillcontinuetoinvestin growth inthisdomain.Wehavestrongrelationshipsfor global macroeconomy,weanticipatesignificantfurther business. WithIndia’sincreasingintegrationintothe We haveseensignificantgrowthinourlongdistance International LongDistanceBusiness products andservices;exportplans; exports; developmentofnewexportmarketsfor Activities relatingtoexportsinitiativestakenincrease FOREIGN EXCHANGEEARNINGANDOUTGO technology trendsandpractices. required, entersintoarrangementstoavailofthelatest innovation andtechnologyasabenchmarkwherever From timetotime,theCompanyevaluatesglobal avoid wastageandconserveenergyasfarpossible. has beenmadetoensuretheoptimaluseofenergy, requires energyforitsoperationsandeveryendeavor not applicabletotheCompany.However,Company conservation ofenergyandtechnologyabsorptionare provider, theinformationinPartAandBpertainingto Bharti AirtelLimited,beingatelecommunicationsservice ABSORPTION CONSERVATION OFENERGY&TECHNOLOGY REPORT OFTHEBOARDDIRECTORS)RULES1988. COMPANIES (DISCLOSUREOFPARTICULARSINTHE OF THECOMPANIESACT,1956READWITH DIRECTORS’ REPORTINTERMSOFSECTION217(1)(e) EARNING ANDOUTGOFORMINGPARTOF AND DEVELOPMENTFOREIGNEXCHANGE ENERGY, TECHNOLOGYABSORPTION,RESEARCH INFORMATION RELATINGTOCONSERVATIONOF Annexure B 47 b TotalForeignExchangeOutgoRs.53,663mn (b) TotalForeignExchangeEarningRs. 18,093mn (a) Total foreignexchangeusedandearnedfortheyear: basis toalltelecomoperatorsinSriLanka. passive infrastructureservicesonanon-discriminatory has alsobeenincorporatedwithanobjectivetoprovide owned subsidiaryofBhartiAirtelLanka(Private)Limited, addition, BhartiInfratelLanka(Private)Limited,awholly- Bharti AirtelLanka(Private)Limited,SriLanka.In 2009, throughitswhollyownedsubsidiarycompany Airtel startedprovidingtheseservicesfromJanuary Sri Lankatooffer2Gand3GservicesinLanka.Bharti process, fromtheTelecomRegulatoryCommissionof of offerinJanuary2007afteracompetitivebidding Company achieveditsfirstsuccessuponreceiptofletter cost aswellotherrelevantfactors.Initsefforts,the subject toavailabilityoflicenses,growthpotentialand alliances, mergers/acquisitionsinidentifiedmarkets, and outsidethecountryorganicallythrough various opportunitiesforgrowthandexpansioninside The Companycontinuouslyexploresandevaluates Telecom Servicesinothercountries in nearfuture. needs oftheIndiandiasporathroughourglobalnetwork subsidiary companies,acrosstheglobetoaddress plans toextenditsservicesthroughwhollyowned Canada andSingaporein2008-09.TheCompanyalso The CompanyfurtherlauncheditsservicesinUK, launch markedBhartiAirtel’sforayintotheUSmarket. The servicewaslaunchedinDecember2006. friends inIndiaatacosteffectiveandreliablemanner. widespread NRIpopulationinUSAtotheirfamiliesand wholly ownedsubsidiarycompanies,connectsthe Airtel CallHome,ourinternationalcallingservicethrough International CallingCardServices 7/21/2009, 9:23 PM 47 BHARTI AIRTEL ANNUAL REPORT 2008-09 Annexure C

INFORMATION REGARDING THE EMPLOYEES STOCK OPTION SCHEME (as on March 31, 2009)

Sl. Particulars ESOP Scheme 2005 ESOP No. Scheme 2001 1) Number of Stock 87,23,966 *1,94,53,868 Options granted 2) Pricing Formula The Exercise Price per options shall 1,45,07,843 @ 22.5 not be less than the par value of the 8,80,000 @ 0.91 Equity Share of the Company and 21,90,000 @ 70 shall not be more than the price 71,265 @ Nil prescribed under Chapter XIII of the 20,000 @ 120 SEBI (Disclosure and Investor 12,500 @ 221 Protection) Guidelines 2000 as amended. 17,72,260 @ 10 Relevant Date being the Grant Date. 3) Option Vested 22,03,175 1,78,08,375 4) Number of Options exercised 6,59,392** 13,749,755 5) Number of shares arising as 6,53,317 Nil a result of exercise of option 6) Number of option lapsed 21,74,100 41,86,341 7) Variation of terms of option NA NA 8) Money realized by exercise 16,70,45,342*** 35,69,99,122 of options 9) Total number of options in force 58,90,474 15,17,772 10) i) Senior Managerial personnel 1. Mr. Manoj Kohli 4500 Nil 2. Mr. Sarvjit Singh Dhillon 3000 Nil 3. Mr. S Asokan 4500 Nil 4. Mr. Inder Walia 7500 Nil 5. Ms. Vijaya Sampath 3000 Nil 6. Mr. David Nishball 4500 Nil 7. Mr. Jai Menon 7500 10000 8. Mr. Sanjay Kapoor 4500 Nil 9. Mr. K Shankar 4500 Nil 10. Mr. Narender Gupta 3000 Nil 11. Mr. Shaun Parmar Nil 10000 12. Ms. Jyoti Pawar Nil 5000 13. Mr. Srikanth Balachander Nil 12500 14. Mr. Shireesh M Joshi Nil 15000 15. Ms. Ranjana Smetacek Nil 5000 ii) Any other employee who receives Nil Nil a grant in any one year of option amounting to 5% or more of option granted during that year iii) Identified employees who were Nil Nil granted option, during any one year, equal to or exceeding 1% of the issued capital (excluding outstanding warrants and conversions) of the company at the time of grant 11) Diluted earning per share (EPS) 0.0026 NA pursuant to issue of shares on exercise of options calculated in accordance with Accounting Standard (AS) 20 ‘Earning Per Share’

1 Director Report 39-67.p65 48 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 3 o pin hs xriepieete a) Rs. 22.5; Rs 70; ForOptionswhoseexercisepriceeither 13) 4 ecito ftemto n FairvalueMethod:BlackScholes/LatticeValuationModel A description of the method and 14) Incase,the 12) Particulars No. Sl. * ThisincludeRs.1,540thousandonaccountofmoneyreceivedagainst6,075optionspending allottment *** Thisincludes6,075numberofoptionsunderScheme2005,whichispendingallottmentand againstwhich Grantsof4,066,025numbersharesweremadeouttheoptionslapsedoveraperiodtime. ** * money hasbeenrealised. on EPSoftheCompany. impact ofthisdifferenceonprofitsand the yearendedMarch31,2009and Stock Optioncostbasedfairvaluefor the employeescompensationof based onintrinsicvalueoftheStockand compensation oftheStockOptioncost difference betweentheemployees )Wihe vrg arpieR.279 b) NA; NA; Rs.10;Rs221 Rs.Nil;Rs120; 267.95 Rs. 541.53 Rs. Weightedaveragefairprice b) Weightedaverage exerciseprice a) are disclosedseparately:- market priceofthestockfollowing equals orexceedsislessthanthe intrinsic valueofStockOption, i)epce iied v Nil 48to60months iv) ii) Rs.616.80to832.55perequityshare 36.23%to41.39% iii) v) thepriceofunderlying 4.45%P.Ato9.70%(TheGovernmentSecuritiescurve (v) i) expecteddividends (iv) volatility expected (iii) life expected (ii) riskfreeinterestrate (i) weighted averageinformation of options,includingthefollowing the yeartoestimatefairvalues significant assumptionsusedduring cost iscalculatedon of optiongrant share inmarketatthetime mlye opnainN 36,81,825 NA employees compensation 49 the basis f(0.0019) of ESOP Scheme2005 yields areconsideredasonvaluationdate) (assuming 250tradingdaystoannualize) 7/21/2009, 9:23 PM Rs. 542.96 Rs. 427.79; Rs. 168.87; Rs. 139.40; Scheme 2001 ESOP 49 BHARTI AIRTEL ANNUAL REPORT 2008-09 Annexure D

Statement of particulars under section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 for the year ended March 31,2009 and forming part of the Directors’ Report

Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise (A) EMPLOYED THROUGHOUT THE FINANCIAL YEAR 1 A M Rai Sr. VP - International B.E. / B.Tech. 48 28-Sep-00 26 Permanent Technical Services 6,767,855 Fibcom / Project Lead Networks 2 Abhay Kumar Head - Technical B.E. & MBA 41 9-Jul-07 17 Permanent Technical Services 3,025,487 Motorola / Circle Lead - Network 3 Abhay Sr. VP - Technical B.E. / B. Tech 44 5-Aug-06 19 Permanent Technical Services 7,872,136 Bharti Infotel / CTO Savargaonkar 4 Abhay Seth CMO - East Hub MBA 31 7-Jan-00 12 Permanent Sales & Marketing 3,216,535 Self Employed / M&G + MD (Own Company) Gujarat circle 5 Abhijit DGM - CSD B.E. 36 3-Oct-06 15 Permanent Customer Service 2,573,170 WNS / AVP - Network Operations Chakravarty Delivery & Infrastructure 6 Abhilasha Hans CSO - MBA 44 23-Jan-07 18 Permanent Customer Service 6,157,707 Teletech Services India Limited / Shared Services Delivery Sr. Vice President 7 Aditya Chile Head - CSD PGDBM 43 5-Dec-05 21 Permanent Customer Service 3,114,966 Tata Teleservices Limited / Delivery Head- Customer Care 8 Ajai Puri CEO - MO MBA 48 15-May-04 28 Permanent Operations & 8,689,842 Cargill Foods India/Business West Bengal Management Head-India Foods 9 Ajay Aggarwal DGM - Marketing B.E. & MBA 38 27-Dec-05 13 Permanent Sales & Marketing 2,478,158 Reliance Infocomm Limited / Circle Sales Head 10 Ajay Agrawal Sr. VP - Finance CA 52 1-Jun-06 26 Permanent Finance 5,939,570 Reliance Infocomm Limited / & Accounts Tech Lead-RA 11 Ajay Chitkara Chief Operating PGDBM 37 1-May-01 15 Permanent Operations & 7,409,091 Comsat Max Limited / Area Sales Officer Management Manager 12 Ajay Krishnan Head - Managed MBA 42 17-Jan-05 17 Permanent Sales & Marketing 4,004,798 AT&T / Regional Director Services 13 Ajit Chaturvedi Head - General Trade MBA 41 27-Mar-06 18 Permanent Sales & Marketing 5,824,116 Reliance Infocomm Limited / Head - Prepaid Sales & Distribution 14 Akhil Minocha GM - Strategic PGDBM 36 9-Jun-05 12 Permanent Sales & Marketing 2,526,967 Reliance Infocomm Limited / Planning & Bus Dev. Sr.Manager 15 Alok Bafna Head - Finance CA 35 29-Dec-03 12 Permanent Finance 3,516,870 Idea Cellular Limited / & Accounts Manager -Finance 16 Alok Dhar Technical Head - B.E. / B.Tech 42 18-Sep-06 20 Permanent Technical Services 3,854,694 Escotel Mobile Communications AES Corporate Limited / Chief General Manager 17 Alok Nigam Head - HR - North Hub LLB 43 16-Mar-06 21 Permanent Human Resources 3,247,349 Intex Technologies Limited / Head Corporate HR 18 Alok Ranjan Head - NLD Voice B.E. & MBA 55 24-Jul-07 14 Permanent Sales & Marketing 2,981,287 Reliance Communications Limited / Head - NLD Services 19 Aman Nugyal GM - Security M.Tech/MS 41 10-Sep-07 21 Permanent Technology 2,888,009 Secure Synergy Private Limited / Operations Management Services Chief Operating Officer 20 Amandeep Singh CTO - B.E. / B.Tech 38 9-May-03 17 Permanent Technical Services 7,004,836 Spice Communications / West 1 & West 2 Vice President 21 Amit Bhatia GM - CSD PGDBM 37 22-Aug-95 15 Permanent Customer Service 5,329,241 Hotel Taj Bengal / Delivery Duty Manager 22 Amit Head - Sales BE & MBA 34 20-Oct-00 11 Permanent Sales & Marketing 2,614,601 Procter And Gamble / Chandiramani Asst Brand Manager - Marketing 23 Amit Mathur VP - Sales MBA 41 2-Jul-01 19 Permanent Operations & 4,178,530 Esconet (Escorts Grp Co) / Management Regional Operational Head 24 Amit Mathur GM - Marketing B.E. / B.Tech 45 19-Nov-01 22 Permanent Sales & Marketing 2,913,122 Xerox Modicorp / Regional Product Manager 25 Amit Shah Head - Finance CA 33 3-Dec-01 11 Permanent Finance 3,359,905 BPL Mobile Communications & Accounts Limited / Manager - Finance 26 Amit Vyas VP - International MBA 35 14-Jun-04 14 Permanent Sales & Marketing 3,861,052 NM Rothschild / Manager Networks 27 Amita Arya GM - Technical M.Tech 38 1-Feb-01 16 Permanent Technical Services 3,521,095 MTNL / Dy. General Manager 28 Amrita Gangotra CIO - Mobile Services M.Sc. 44 25-Nov-02 18 Permanent Technology 8,423,503 HCL Comnet Limited/ & Chief Airtel IT Services Chief Information Officer Operations 29 Anand Jha GM - B.E. / B.Tech 43 24-Jun-03 16 Permanent Technology 3,084,384 GE Motors Limited / Technology Services Services Quality Leader Washer 30 Anant Arora COO - MO Kerala B.E. & MBA 42 11-Apr-03 19 Permanent Operations & 6,195,059 Reliance Infocomm Limited / Management Head - Sales Operations 31 Anantharaman R COO - MO M.Sc. 42 26-Sep-03 18 Permanent Operations & 5,629,175 BPL Mobile Cellular Limited / West Bengal Management Business Head

1 Director Report 39-67.p65 50 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 3Au pi ed-SMMA4 5Dc0 8PraetSpl hi ,5,3 Nitel/Production Engineer 2,853,739 American Airlines/Senior 5,595,097 BTInfonet/NationalHead 2,401,948 18 Supply Chain Sales&Marketing Technology Permanent Permanent Permanent 18-Oct-06 18 15 40 TataTeleservicesLimited/ 20 3,183,943 Technical Services Escotel Mobile Communications DHLInternational/ 15-Dec-06 28-Aug-06 Permanent 2,779,210 26,164,755 Siemens/GeneralManager MBA 43 38 25-Jun-07 3,900,653 Business Head TechnicalServices 44 Legal Services 14 B.E./B.Tech Permanent Permanent HenkelMarketingIndiaLimited/ TataTeleservicesLimited/ Permanent 2,662,454 VP-CSD 2,639,750 GodfreyPhillipsIndiaLimited/ MBA Sales&Marketing Technical Services 3,421,732 Hutchison EssarPvtLimited/ 23 15 29-Aug-06 2,516,128 18 MBA Sales&Marketing Batra Aviral GM-Sales 36 Sales&Marketing Permanent Permanent 66 Avinash Deepak VP-WebTech& Permanent 65 Head - SCM Permanent AustinLorenzo 14 9 23-Jun-03 64 IBMDaksh/Sr.Manager-TTBV 2-Apr-07 / Limited Sify 1-Nov-04 15 PGDBM 48 2,694,236 4,970,841 Uprit Atul 39 9 42 Sales&Marketing BE(Mech),MBA 63 Principal Technical Services Quality AtulSachdeva 30-Jan-07 16-May-05 President-Mobile Permanent B.E./B.Tech Permanent 62 14-Jun-04 41 36 GM-CorePlanning PGDBM VavasiTelegencePvtLimited/ IdeaCellular/ 38 AtulBindal 2-Aug-06 (Tech) Director Dy. / Universal Mccann/ STPI 6,196,515 15 2,793,419 3,961,518 4,143,417 13 Technical Services 61 Tandon Asit 32 B.E./B.Tech CustomerService TechnicalServices Sales&Marketing GM-Regulatory Escotel MobileCommunications 60 4,465,718 Ashwani Permanent Rana Reliance InfocommLimited/ Permanent MBA Permanent Permanent 59 3,962,839 GM-Technical Services Quality MBA TechnicalServices 3-Apr-07 AshutoshSingh 3-Aug-05 30 DGM-Marketing 58 19 39 MBA 16 17 Permanent 39 Tata/VicePresident Ashish Yakhmi Permanent GM-Marketing 4,031,731 57 Sales & Marketing AshishLuthra 35 DGM-Prepaid B.E.&MBA 21 56 17-Jul-07 BPL Mobile Communication 21-Dec-00 Permanent 2-Mar-07 MBA 3,083,289 1-Mar-96 53 Ashish D K Teletech/CenterHead 39 42 Sales&Marketing EricssonInc/GM 38 3,125,630 GM-Business 55 7,759,009 22 AshishCTayal Customer Service 2-Aug-04 VP-SalesHead VSNL/BusinessHead-MPLS Sales&Marketing 14-Jun-05 B.E.&MBA Permanent 3,986,198 54 XeroxModiCorpLimited/ 55 44 Sales&Marketing AshishArora 7,831,413 Permanent Sr.VP-Network M.Tech Permanent PGDM 53 14 CustomerService GM-NetworkNOC Arvind Kumar Permanent B.E. 27-Nov-06 MBA & B.E. 15 52 25 Pidikiti Aruna 45 PGDBM Permanent SynovateIndia/ 51 GM-Service 18 2,621,357 GM-Marketing Srievastava Arun 13-Mar-06 2,990,900 Sales&Marketing 24 50 Technical Services 39 VP-Business RelianceInfocommLimited/ Arun Kumar 4,827,640 2-Jan-07 Permanent 1-Feb-02 49 MBA TechnicalServices Permanent CTO 35 Arun Kumar 25-Feb-08 46 OperationsHead-AP 48 41 13 16-Jul-03 Permanent Arun Kumar 17 MMS MBA & B.E. 48 47 Officer Operating Chief Arun Das 46 21 Arun Bhardwaj B.Com Head-Marketing 45 GM-ServicePartner PGDBA Arshad Mumtaz 9-Apr-07 24-Mar-08 PGDBM VP-MPLSProduct 44 37 42 Arindom 28-Feb-05 43 Argha Basu 45 42 PMO-CSD PGDBM AnuragPrashar MBA 41 Head-Customer M.Tech Anupma Suneja ANG -Wireless, CTO VP-Network 40 AnujKhungar 39 Anuj Jain 38 35 Anjana Head - HR MBA 52 17-May-02 30 Permanent Human Resources 3,122,807 Mega Soft Limited / Limited Soft Mega 3,122,807 Human Resources HindustanLeverLimited/ TataTeleservicesLimited/ 4,862,244 Permanent Hughes Communications / 2,746,349 3,073,334 Operations& Customer Service 30 Supply Chain Permanent Permanent Permanent SatyamInfowayLimited/ 2,487,388 TechnicalServices 17-May-02 17 16 20 52 Permanent 42 17 3-May-04 2-Jul-07 25-Jul-05 40 Diploma MBA 38 44 14-Dec-05 GM-Metasolv 38 PGDBM Anoop Sharan Head-HR MBA MBA 37 GM-CSD(Remote Anoop Bhardwaj 36 Anjana MBA COO-MO 35 GM - SCM Anirban Ghosh 34 GM-Technical Anil Kumar 33 Anil Jhamb 32 l aeDsgainQaiiain()AeDt fTtlNtr fNtr rs Previousemployment/ Gross Nature of Nature Total of Date Age (s) Qualification Designation Name No. Sl. ahtaAcquisitions& Malhotra ChiefTNGOffice Kansal Excellence Sharma Malik Gupta Chakrabarty Ravindranath Syst. Int.Arch Officer Services Affairs Market Planning Excellence Operations Management Research Insight &Market Network Planning Support Process) Tamil Nadu 51 -c-51 Permanent 16 4-Oct-05 of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement emnn utmrSrie29610RelianceLifeInsurance/ 2,916,180 CustomerService Permanent otata employee or otherwise contractual 7/21/2009, 9:23 PM eieyHead-CustomerCare Delivery evcsConsultant/TechLeadArchitect Services Management Dy.GeneralManager Delivery ExecutiveDirector,Customer Delivery Delivery evcsAsst.GeneralManager Idea 2,792,653 Services Technology eieyDirector-Operation RegionalSalesManager Sr.Manager Delivery Management Management and CorePlanning Head-Bss,Transmission Pacific Communication DirectorAsia Limited /Sr.Manager Sr. Manager Category Manager Brand Manager Head -Marketing National SalesHead Chief TechnicalOfficer Associate MediaDirector Limited /Dy.GeneralManager Fa LeadMumbaiCircle Limited /Dy.GeneralManager Research Director Chief TechnicalOfficer / Director-ProductDevelopment Fujitsu NetworkCommunicationInc. Service Support Head CorpCommunication Sr.Manager Cellular Limited/ 51 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 67 Awadhesh Kumar Head - Technical M.Tech/MS 44 5-Feb-07 23 Permanent Technical Services 2,908,863 Indian Army / Kalia Commissioned Officer 68 Awnish GM - Device PGDBM 39 20-Feb-06 19 Permanent Sales & Marketing 3,010,352 Reliance Infocomm Limited / Choudhary Management Manager 69 B Harikumar GM - Network - B.Sc 49 23-Jul-03 26 Permanent Technical Services 2,564,157 Ericson Telephone Switch / Operations Sr. Manager 70 B Vishwanathan GM - Finance MBA 42 12-Jan-04 22 Permanent Finance 3,370,261 HFCL Infotel Limited / & Accounts Dy. General Manager 71 Benjamin Antony DGM - HR MBA 34 16-Aug-07 12 Permanent Human Resources 2,843,338 Aviva Life Insurance / Sr. Manager 72 Bhairab Hazarika GM - Media, B.E / B.Tech 39 10-Nov-04 16 Permanent Technology 3,368,063 Reliance Infocomm Limited / Unified Messaging Services Dy. Configuration Head 73 Bhaskar Chief Supply Chain PGDBM 51 19-May-97 29 Permanent Supply Chain 9,109,409 Fibcom India Limited / Chakraborty Officer Management Chief of Materials 74 Bhavna Puri GM - Head - Service B.Sc 39 17-Jun-02 19 Permanent Customer Service 3,060,948 Hexacom (India) Limited / Marketing & Contact Delivery Incharge Customer Care Experience 75 Bosco Soiero Zonal Business MBA 39 19-Feb-07 16 Permanent Sales & Marketing 2,890,079 Reliance / Cluster Head Manager 76 C V N Varaprasad GM - Technical B.E./B.Tech 39 28-Feb-08 16 Permanent Technical Services 2,558,168 BSNL / Dy. General Manager 77 Chandrakant GM - Technical B.E./B.Tech 37 29-Dec-00 15 Permanent Technical Services 2,463,402 Reliance Telecom Limited / Tripathi Deputy Manager 78 Chandrasekar Sr. VP - Marketing MMS 36 9-Jul-07 12 Permanent Sales & Marketing 6,047,299 Marico / Category Head Radhakrishnan 79 Charanjit Singh GM - Security Plans MBA 40 1-Mar-07 19 Permanent Technology 3,030,033 Fidelity International / Sodhi & Policies Services IT - Security 80 Chetan Kumar GM - Technical PGDBM 39 20-Sep-04 17 Permanent Technical Services 2,477,621 BSNL(DOT) / Dy. General Manager 81 Christopher Tobit Director - Sales B.A. 45 1-Feb-99 24 Permanent Operations & 9,427,569 Collettes Group Of Companies/ & Operations Management Group Business Development Manager 82 Dabasis Dutta SMG Head - AES CA 40 1-Dec-02 9 Permanent Customer Service 2,741,115 Dabasis Dutta & Co. / Carrier Delivery Business Head 83 David Nishball President - Enterprise Bachelor of Arts 54 1-Feb-07 30 Contract Business Head 52,715,429 Orange Business Service / Services in Economics Sr.Vice President & MBA 84 Deepak Bagga Head - Technical B.E./B.Tech 40 21-May-07 10 Permanent Technical Services 2,620,870 Erricsson India Limited / Sr. Manager 85 Deepak Bhatia VP - CSD MBA 36 10-Oct-05 13 Permanent Customer Service 3,793,745 Tata Teleservices Limited / Delivery Head- Customer Service Delivery 86 Deepak Khanna CEO - ABS MBA 45 2-Mar-04 24 Permanent Operations and 9,427,913 Cybiz Technology Limited / Management Whole-time Director 87 Deepak Mehrotra Executive Director - BE (Electrical), 45 30-Oct-03 19 Permanent Business Head 12,487,937 Hindustan Coca Cola Beverages/ South and West 2 Hub MMS Region Vice President - Operations 88 Deepak Sanghi DGM - Networks B.E./B.Tech 35 29-Mar-04 14 Permanent Technical Services 2,580,612 Nortel Networks / Technical Consultant 89 Deepak Singh GM - Data Product B.E./B.Tech 42 11-May-04 20 Permanent Sales & Marketing 3,008,456 Reliance Infocomm Limited / Karki Organization Head Business Solution 90 Deepak CEO - DTH B.E./B.Tech 49 13-Sep-04 24 Permanent Operations & 7,897,797 BOC Edwards/GM-South Asia & Srivastava Management Country Manager,India 91 Deven Khanna Corporate Director - B.Com, CA 49 1-Sep-04 19 Permanent Finance 13,702,214 Triveni Engineering Industries Finance Limited/VP-Corporate Finance (Telecom & Retail) & Planning 92 Dharmender Head - Sales MBA 40 21-Nov-01 17 Permanent Sales & Marketing 3,101,658 National Panasonic / Khajuria General Manager-Sales 93 Dinesh Daryani VP - Service PGDBA 43 12-Jan-04 17 Permanent Customer Service 3,682,351 Escotel Mobile Communications Operations and Delivery Limited / Asst. General Manager B2C Projects 94 Dinesh Singh DGM - CSD B.E./B.Tech 36 4-Sep-06 13 Permanent Customer Service 2,606,085 Cadence Design Systems / Delivery Manager Network 95 Dipak Roy Head - HR - Mobility MBA 42 19-Jun-06 21 Permanent Human Resources 7,369,932 IBM / GM 96 Divya Sethi GM - Prod Sales MBA 36 4-Oct-06 12 Permanent Sales & Marketing 2,729,240 Hughes Escorts Communication Specialist, VSAT Limited / National Manager & Conf. Business 97 Pawan Bakhshi GM - Marketing VAS Ph.D. 44 1-Aug-01 16 Permanent Sales & Marketing 3,852,343 Reliance Infocomm Limited / Sr. Manager 98 Durgesh Madan Head - SMG CA 44 28-Feb-06 19 Permanent Customer Service 3,213,898 Reliance Infocomm Limited / Delivery Head BLC 99 Dushyant Kumar Head - Technical B.E./B.Tech 43 2-Nov-98 17 Permanent Technical Services 3,456,462 California Microwave Inc / Manager

1 Director Report 39-67.p65 52 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 3 iehNbia einlVieHa ..BTc 02-o-11 emnn ae aktn ,3,3 TractbcTirforIndiaPrivate 2,637,836 Sales&Marketing Permanent 19 17-Apr-07 Head-IT 20-Nov-01 37 40 Joseph B.E./B.Tech B.E./B.Tech 133 DGM-IT&Innovation Regional Voice Head Jinesh Nabhiram 132 Jehangir 131 3 awn oa ed-FnneC 51-u-51 emnn iac ,7,1 PepsiCoIndia HoldingsPvt 2,473,018 Finance Permanent 18 12-Jul-05 45 CA Head-Finance JaywantMohan 130 2 JantinaCatharina 129 HCLComnetLimited/ 2,541,185 Sales&Marketing ComverseNetworkSystems/ 4,901,718 Permanent CustomerService HCIL/Head-Program Genpact /VicePresident 3,080,978 5,347,851 11 Permanent 23 Customer Service TennecoAutomotive Inc/ 3,158,157 CocaColaIndia/Head-Sales Technology 30 Permanent 4,515,636 Sales&Marketing 21-Jun-02 Mobile Escotel 12-Feb-01 Permanent 2,595,955 33 15 Finance Sales&Marketing 44 Permanent 10-Jan-07 20 Permanent Permanent 53 17 B.E./B.Tech 29-Sep-06 MBA 16 17 42 MBA & B.E. GM-Technical 9-Jul-07 GurmeetSingh 17-Nov-06 109 42 DGM-Sales 40 GunjanSachdev 17-Mar-03 108 8-Nov-01 CSD - VP MBA 41 38 GovindNarayan 107 Head-CSDAP B.Com GopalakrishnanR MBA VP-Sales&Marketing 106 GeorgeMathen 105 PGDBA VP-MobilityIT CA George Fanthome 104 Head-Business Gaurav Tandon Head-Finance 103 GaneshBabu 102 2 ads ed-SrieMS 82-e-43 emnn utmrSrie46327Spice CommunicationsLimited/ 4,643,257 CustomerService CasioIndiaCo./Asst.Manager 2,586,508 Permanent Sales&Marketing NortelNetworks,Singapore 13,923,123 Technical Services 36 Permanent Permanent VodafoneGroupTechnology/ 16 Comverse Network Systems / 3,671,710 3,583,429 23 26-Feb-04 Customer Service TechnicalServices Sify/UnitHead 58 3,030,355 Permanent Permanent Sales & Marketing 3-Nov-00 40 9-Nov-01 Permanent 17 30 RelianceInfocommLimited/ 45 BlueDartExpressLimited/ M.Sc 2,680,854 4,372,008 TechnicalServices Customer Director- 19 Permanent Head-Service Operations& MBA 11-Jan-01 2-Apr-07 JaiMenon 128 58 MBA KoshikaTelecomLimited/ 42 Band-X-Limited/Manager 6-Aug-07 Permanent 5,209,615 12 DGM-Marketing 2,863,897 JagdishS 4-Mar-02 TechnicalServices 127 51 Sales & Marketing JagdeepSethi SterlingHolidayResortsIndia 37 B.E./B.Tech 126 CTO-Mobility M.Tech/MS 20 2,636,617 Solutions Technology Integrated Permanent Permanent Sales&Marketing 3,771,956 SpiceCommunicationLimited/ ParsecTechnologyLimited/ Jagbir Singh 2,689,017 Sales&Marketing B.E./B.Tech 2,526,906 125 GM-Technical 1-Jun-05 PGDBM 20 Permanent Sales&Marketing 14 36 JPSrivastava Permanent 124 GM-P2M SupplyChain 13-Jul-95 GroupDirector- Permanent InderjitHundal 17 38 DGM - Sales 123 TecumsehIndiaLimited/ Motorola IndiaLimited/Head B.E./B.Tech 19 Permanent 3,432,529 4,175,907 16-Feb-99 Inder Walia 15-Mar-02 RelianceInfocommLimited/ 15 Human Resources 122 3,581,308 41 I P Tiwari 37 GM-Networks 25 121 TechnicalServices SupplyChain 19-Nov-95 Permanent HemantMalik MBA 15-Apr-04 38 120 B.E./B.Tech Permanent Permanent Head-SalesKolkata 43 Hemant Dadlani 9-Feb-05 16 119 30-Sep-03 Head-Technical 40 19 31 BA HeeraLalGupta 51 118 PGDBM Sales/Corporate - DGM HarshMalhotra DGM-Sales/ISP/ 117 MBA 18-Jul-05 PGDBM Harsh Dhillon 14-Feb-06 38 116 1-Mar-07 B.Com RegionalBusiness 43 54 HarpreetSingh GM-Marketing 115 Harish Kumar M.Tech/MS 114 Head-SCM MSW PGDBM HarinderSingh 113 Technical - GM HariSreedharan 112 Head-SCM GM-HR Harendra Kumar 111 HCRuben 110 PGDSCM Information Chief FelixMohan 101 0 lnoTaba E OA B 44 MBA CEO-MOAP Elango Thambiah 100 l aeDsgainQaiiain()AeDt fTtlNtr fNtr rs Previousemployment/ Gross Nature of Nature Total of Date Age (s) Qualification Designation Name No. Sl. Rajakumar A Hegde Khambata Puri a eVed oprt uc a Corporate DutchLaw Corporate & Vreede van de Dwivedi adaaMarketing Randhawa Wadhwa Grewal Salvadoray Sandhu Responsibility Service & IT & PhD Mech Engg Technology Corporate Officer and Officer Corporate Technology &PhDMech Engg Director-Alliance Service &IT Solutions Eng Excellence Dev &Execution Security Officer Human Resources Carriers/Cable Head 53 ..BTc 52-a-22 emnn ehooy28303RPGPagingLimited/Manager 2,853,083 Technology Permanent 22 28-Jan-02 45 B.E./B.Tech atro 91-u-13 otatAlac 62284British 26,252,834 Alliance & Contract 32 Permanent 16-Aug-01 17 49 Master of 22-Aug-02 45 MS–Mech Engg. 39Ot0 2Permanent 12 9-Oct-06 53 -c-12 emnn prtos&98207Spice Communications/ 9,822,047 Operations& Permanent 21 8-Oct-01 of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement 3PraetTcnclSrie ,8,4 Nortel/Manager 4,989,048 Technical Services Permanent 13 5PraetHmnRsucs2,5,8 ArcelorMittal/ 25,552,186 Human Resources Permanent 25 emnn ehia evcs30869Punwire/Asst.GeneralManager 3,068,689 TechnicalServices Permanent otata employee or otherwise contractual 7/21/2009, 9:23 PM Services consLimited/GM-Finance & Accounts Responsibility eieyDirector Delivery nomto 22995BellSouthCorporation/ 32,209,925 Information Management Delivery FinanceController Services & Accounts ehooy65067SecurtSynergy/Director 6,590,607 Services Technology eieyVicePresident Delivery Sr.Manager Management eieyProgrammeManager SalesExecutive Delivery Management AssociateVice Management aaeetVicePresident Management Limited /RegionalManager Executive VicePresident Major AccountManager Assistant Manager-Sales Communications Limited/ Solutions Director-Network Systems& Associate Consultant Corporate Director-HR Network Architect Sr.Manager Limited /Sr.SalesExecutive Pvt Limited/GeneralManager Sr.Manager Technical Head Learning, HRStrategy&OD Director Sourcing-AsiaPacific Telecom/ AllianceDirector President / 53 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 134 Joydeep Roy GM - FX & OM MBA 39 10-Jun-02 14 Permanent Customer Service 2,735,612 Idea Cellular Limited / Chowdhary Delivery Assistant Manager-Customer Care 135 K Rangarajan GM - Marketing MBA 40 1-Nov-04 16 Permanent Sales & Marketing 2,566,669 Marketing And Development Research Associates / Project Director 136 K Shankar GM - T2R-I&FR B.E./B.Tech 42 23-Jul-97 22 Permanent Technical Services 2,956,226 Pertech Computers Limited / Dy. Manager- Scm 137 K Srinivas Joint President - BE, PGDBM 46 7-Nov-02 21 Permanent Business Head 13,944,730 Hindustan Lever Limited/ Telemedia Services Business Manager New Ventures 138 Kavi Mahajan Head - Marketing MBA 35 20-Aug-07 13 Permanent Sales & Marketing 2,697,974 Idea Cellular Limited / Manager 139 Kedar Teny GM - Marketing MBA 37 26-Sep-07 13 Permanent Sales & Marketing 2,410,719 Lowe Worldwide / Brand Planning Director - South East Asia 140 Kishor Asrani National Sales B.Sc 39 15-Feb-05 18 Permanent Sales & Marketing 3,218,740 HCL Infinet Limited / Vertical Head - M&D Zonal Head - North & East 141 Koustuv Mitra Head - HR B.Sc 46 11-Dec-06 22 Permanent Human Resources 6,123,032 Convergys India Services Private Telemedia Services Limited / Senior Director 142 Krish Shankar Director - HR PGDBM 46 23-Mar-07 25 Permanent Human Resources 19,557,158 Unilever Asia Africa Singapore (Hindustan Lever Limited)/ Vice President - HR 143 Krishan K Sharma DGM - Sales MBA 35 3-Oct-97 14 Permanent Sales & Marketing 2,545,456 Sayaji Hotels Limited / Sales Executive 144 L Ramakrishna VP - SCM M.Tech 44 29-Sep-00 18 Permanent Supply Chain 4,162,320 Alcatel / Sr. Manager Management 145 Lal Bahadur VP - Service Delivery PGDCBM 42 1-Jul-02 19 Permanent Customer Service 4,600,160 Wipro Infotech / Project Manager Prasad Delivery 146 LV Lanka Operations Head - MBA 42 19-Sep-06 19 Permanent Sales & Marketing 4,646,087 Xerox India Limited / Venkata Sastry Karnataka GM-National Key Accounts 147 M P Deepu Head - Contact BA 36 15-Oct-96 16 Permanent Customer Service 3,443,774 Hab Est, Saudi Arabia / Experience Delivery Sales Executive 148 Madanagopal CIO - MBA 48 11-Feb-04 24 Permanent Technology 4,511,713 RPG Cellular / Head - IT Ramachandran South & West 2 Services 149 Madhav Shenoy VP - Network M.Sc 43 13-Oct-04 19 Permanent Technical Services 3,493,561 Institute Of Quality Limited / Associate Vice President 150 Madhu Dua GM - Marketing PGDITM 37 20-Feb-02 16 Permanent Sales & Marketing 2,696,867 Escotel Mobile Communications Limited / Maanger 151 Madhukar VP - Network B.E./B.Tech 47 25-Jun-07 24 Permanent Technical Services 3,530,142 Tata VSNL / Srivastava Head-Planning & Implementation 152 Madhuranjan GM - Technical M.Tech 41 4-Mar-02 13 Permanent Technical Services 2,763,964 Lucent Technologies / Engineer Kumar 153 Mahendra Kumar GM - Network B.E./B.Tech 45 30-Nov-01 22 Permanent Technical Services 2,842,745 Shyam Telelink Limited / Deputy Baghel General Manager 154 Mahesh Thampi COO - MO MP&CG Post Graduation 47 20-Mar-06 24 Permanent Operations & 7,843,930 Reliance Infocomm Limited / Management Circle Head 155 Manav Deep GM - Marketing MBA 36 14-Nov-06 10 Permanent Sales & Marketing 3,281,569 American Express Bank Limited / Mianwal Product Head 156 Manika Choubey GM - INT Delivery M.Sc 45 20-Jun-97 18 Permanent Technology 3,196,852 PCL Software Exports Division / Services Sr. Manager 157 Maninder Singh Head - Technical B.E./B.Tech 40 9-May-05 19 Permanent Technical Services 3,452,228 HFCL Infotel Limited / Dy. General Manager 158 Manish Bhatt VP - Marketing PGDBM 42 11-Sep-03 24 Permanent Sales & Marketing 4,023,909 BPL Mobile Limited / Branch Head 159 Manish Lamba GM - Legal LLB 37 1-Aug-06 12 Permanent Legal Services 2,705,502 Hindustan Coca Cola Beverages Private Limited / Legal Councel (In House) 160 Manish Rastogi Head - CS - South PGDBM 42 10-Jun-02 17 Permanent Customer Service 3,912,677 Honda Siel Cars / & West 2 Delivery Manager Marketing 161 Manish Trehan Head - Modern Trade BA (Hons) 44 26-Aug-02 16 Permanent Sales & Marketing 4,701,518 Hindustan Times Limited / Dy. Manager 162 Manisha Chopra Head - HR MBA 42 1-Feb-07 20 Permanent Human Resources 2,660,975 Reliance Infocomm Limited / Head-HR 163 Manoj Kohli CEO & Joint B.Com, LLB, MBA 50 26-Oct-02 29 Permanent Business Head 39,264,622 Escotel Mobile Communications Managing Director Limited / Executive Director & Chief Executive Officer 164 Manoj Kumar Head - IT - MBA 39 1-Feb-07 17 Permanent Technology 2,564,385 Induslogic Inc / Director - CSS Jain AES Corporate Services 165 Manoj Manicketh VP - Sales MA (Eco) 43 24-Sep-03 22 Permanent Sales & Marketing 4,322,386 Reliance Infocomm Limited / City Manager - Wired Line 166 Manoj Murali Head - CSD MBA 38 1-Oct-01 14 Permanent Customer Service 3,338,254 Crompton Greaves / Delivery Area Sales Manager 167 Manoj Paul Chief Operating Officer B.E. & MBA 41 8-Apr-02 16 Permanent Operations & 5,179,962 HCL Commet / GM Legal - Enterprise Services, Management Mumbai

1 Director Report 39-67.p65 54 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 9 iajnRyCifCnrle A4 -a-61 emnn iac 06228UnileverNv/Plc, USA/ IndiaSatcomLimited/ 10,672,208 2,512,339 Technical Services Permanent BPL Mobile Limited/Manager 3,085,055 Finance Microsoft/RelationshipManager 4,162,164 23 BPL Mobile Communications Sales & Marketing Permanent 3,614,868 Technology Siemens Informations System Permanent 3,832,695 19 Sales&Marketing Permanent 19-Jan-01 21 Finance Permanent 48 19 Permanent Barclays/AssociateDirector 1-Mar-06 17 3,451,375 43 12-Jun-06 Customer Service 15 45 MBA 17-Jul-01 Permanent 47 DGM-Technical/ 1-Mar-00 39 13 CA 7-May-03 P R Sridhar MBA 199 39 NationalSalesVertical PGDCA M.Tech/MS Nivedan ChiefController- Sahani 198 10-May-07 Nilanjan Roy Head-ITEast 197 35 Nikhil Kumar GM-Sales 196 CA NeerajJain PGDBM 195 Head-Finance Navin Sherman 194 GM-Collections NaveenGupta 193 9 aenGM-SCM Naveen 192 9 aaaa ed-H at A(s)4 -o-72 emnn ua eore ,7,2 WiproLimited/VicePresident 3,476,927 IBMGlobalServices / Human Resources 3,349,639 AlcatelBusinessSystems/ Permanent 4,621,686 Technology 20 Operations& Permanent EscotelMobileCommunications Permanent 5,060,504 15 IndianArmy/Colonel 7-Nov-07 17 2,561,927 TataTeleservices Limited/ 25 45 SupplyChain TechnicalServices 2,578,008 Limited/ Tele-Ventures Bharti 16,208,854 Permanent Permanent Samsung India / 2-Nov-05 51 Supply Chain Business Head 2,704,442 (Psy) MA 41 PGDBM, B.Com, Sales&Marketing 3-Jul-01 1-Aug-00 22 34 Permanent Permanent Director- 39 Corporate 45 Head-HREast, StandardCharteredBank/ Permanent NarenderGupta 6,067,265 191 21 28 SpiceCommunicationLimited/ Customer SatyamInfowayLimited/ Service B.E./B.Tech PGDM Narayanan B.E./B.Tech Officer Operating Chief 3,064,447 2,773,915 190 15 19-Apr-05 19-Jul-04 Sales&Marketing Permanent 52 44 DalmiaConsumer Care/ Head-Technical Najib Khan 3,384,575 189 Permanent 17-Jan-83 4-Sep-06 17 Nagarajan R Finance M.Tech/MS B.E./B.Tech 52 42 1-May-07 188 VP-IT 12 38 Technology Chain Supply Chief NShankerRavi Permanent 187 Technical - Head B.Com, MBA NPMuralidharan 186 Permanent ExecutiveDirector- GEMoneyFinancial 1-Jul-05 13 NLGarg 3,408,351 MFM 185 40 Sales&Marketing 15 2-Jul-01 MBA 39 N Arjun Permanent 184 19-Nov-01 GM-Marketing JMMorganStanley/HeadSales MurtuzaCharania GM - SCM 183 37 7,486,919 B.E./B.Tech 14-Jun-05 12 MBA 38 Muralidhar DGM-ILD/Carrier 182 & Operations Head-Service MuraliNayar PGDBM 181 27-Sep-06 Permanent CA PGDBM Kittu Murali 36 180 VP-Marketing 15 MunishKanotra 179 Head-Finance MukeshSingla PGDBM 178 Head-IT MuditAgarwal 1-Apr-03 177 Head-Sales& 38 GM- Mohan Verma 176 B.E.&MBA Officer Operating Chief Mohammed 175 MilanRao 174 7 enkh apiS.V TPDA4 2Ag0 3PraetTcnlg ,7,1 VCustomer ServicesIndiaPvt 5,474,517 Verizon Communications Irving 8,555,713 Technology Permanent Information Permanent 23 18 12-Aug-03 46 13-Dec-06 43 MSinComputer, Head-Service PGDCA MichaelEricLobo 173 Architecture Chief MehulKShah 172 Sr.VP-IT MeenakshiVajpai 171 6 ao adnG ewr ..BTc 11-e-21 emnn ehia evcs26981HughesTelecom(I)Limited/ 2,619,801 TechnicalServices Permanent 45 18 16-Dec-02 CA 41 B.E./B.Tech CEO-MO Manu Talwar 170 GM-Network ManojTandon 169 6 ao a G aktn B 41 MBA DGM-Marketing Manoj Rao 168 l aeDsgainQaiiain()AeDt fTtlNtr fNtr rs Previousemployment/ Gross Nature of Nature Total of Date Age (s) Qualification Designation Name No. Sl. Aldangady rnnhlmWest&SriLanka Arunanchalam Sarma Sankaranarayanan Imthiaz Yunus BSG Head -PSU&Govt Mobility & SriLanka ru euaoyFCS,LLB Affairs Group Regulatory South - EnterpriseServices, &PGDiplomain Officer DTH Services Operations Marketing Delhi - EnterpriseServices, Operations Maharashtra &Goa & Planning - IT & BS (Engg) Technology TX/ Techinical Manager-Strategic Techinical TX/ Technology (Engg) BS Innovation & Planning-IT aktn GB 46Jn0 0PraetSls&Mreig32897McDowell&Co.Limited / 3,258,947 Sales&Marketing Permanent 10 6-Jan-04 34 PGDBM Marketing 55 ..BTc 21Fb0 9PraetSpl hi ,9,9 RCL/Head-Source 2,995,793 SupplyChain Permanent 19 1-Feb-07 42 B.E./B.Tech International Trade A4 8Ot0 2PraetCsoe evc ,5,9 KoshikaTelecomLimited/Asst. 3,655,497 Customer Service Permanent 22 18-Oct-02 45 BA 89Ot0 4PraetSls&Mreig50817SpiceTelecommunications/ 5,078,127 Sales&Marketing Permanent 14 9-Oct-01 38 -e-92 emnn euaoy1,3,6 DLF CementLimited/ 12,238,062 Regulatory Permanent 29 1-Feb-99 -u-62 emnn prtos&1,6,3 Coca-ColaIndia/ 11,568,430 Operations& Permanent 22 7-Aug-06 8Ot0 4Permanent 14 28-Oct-02 of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement emnn ehia evcs3,888,886 TechnicalServices Permanent otata employee or otherwise contractual 7/21/2009, 9:23 PM Management consFinanceDirector Limited/Sr.Manager & Accounts Services & Accounts Delivery aaeetSr.Manager Management aaeetTechnicalManager Dy.GeneralManager Limited/Dy. Manager Management Services Management NationalManager DeputyManager-Finance Head-IT Delivery & Accounts Services GeneralManager-CustomerCare Management Delivery aaeetRegional Management evcsLimited/GeneralManager Services ae aktn 3,016,047 Sales &Marketing Sr. ManagerNetworkSolutions Business Manager-Marketing Limited / Sr. ManagerLegaltoGM-Legal Chief OperatingOfficer National TrainingManager Account Manager Product Head-RetailLoan Services Limited/ Sr. Manager Head-Technical Bharti CellularLimited/ Sr. Manager & Collections Architecture Platforms Manager -Marketing Global TelecomServicesLimited/ Manager Vice -President 55 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 200 P S Parasuram Head - Innovation, PGDBM 43 22-Jan-07 17 Permanent Sales & Marketing 9,012,155 Sony Entertainment Television/ Marketing & Head Projects Communication 201 P S Sandhu CTO - Sri Lanka M.Tech 58 7-Aug-01 34 Permanent Technical Services 6,552,670 Bonsai Networks India Private Limited / Country Head (India Operations) 202 Pankaj Gulati GM - Finance CA 38 26-Dec-03 13 Permanent Finance & 2,673,712 Eicher Goodearth Limited / Accounts Manager 203 Pankaj Miglani Sr. VP - Finance CA 39 21-Dec-01 16 Permanent Finance & 6,213,535 GE Capital Transportation Accounts Financial Services / AVP 204 Pankaj Sarna VP - SCM B.Com 48 16-Jan-99 23 Permanent Supply Chain 4,097,155 Modi Xerox Limited / Management Controller - Indirect Channels 205 Pankaj Sootha VP - Business M.Tech/MS 40 6-Mar-00 18 Permanent Operations & 4,740,809 Glosolar Energy(India) Limited / Head’s Office Management Technical Manager 206 Parimal Mohile GM - IT BA 48 21-Dec-00 21 Permanent Technology 3,101,266 Milestone Interactive Software Services Limited / Manager Operatiion 207 Parkash Vir DGM - CSD B.E./B.Tech 43 2-Aug-02 22 Permanent Customer Service 2,979,314 HFCL Satellite Comm. Limited / Bhatia Delivery Sr. Manager 208 Partha Roy GM - SCM PGDBM 41 16-Apr-98 19 Permanent Supply Chain 3,242,148 Onida Savak Limited / Management Deputy Manager 209 Parthasarathy GM - Technical B.E./B.Tech 56 24-Aug-01 37 Permanent Technical Services 4,546,285 DOT / Dy. General Manager Munuswamy 210 Pawan Kaushal GM - Prod Mgmt Diploma 37 1-May-00 15 Permanent Sales & Marketing 2,636,398 STPI / Technical & Bus. Solutions 211 Payush Gupta DGM - Finance/ B.E./B.Tech 38 14-Dec-06 14 Permanent Supply Chain 2,521,151 Tata Infotech / Commercial Head Commercial Management (Asst. General Manager) 212 Prabhu Prasad Head - Technical B.E./B.Tech 42 25-Jun-01 21 Permanent Technical Services 2,662,405 Bonsai Networks / Sr. Manager Dash 213 Pramendra Garg Chief Operating Officer CA 35 23-Oct-03 12 Permanent Finance 2,747,812 Aircel Digilink India Limited / - Telemedia, South & Accounts Manager Finance 214 Prasanta Das COO - Telemedia North B.E. & MBA 46 19-Aug-02 24 Permanent Operations & 7,647,884 HFCL / Associate Vice President Sarma Management 215 Prashant Deo Head - HR PGDPM 39 17-Jan-05 14 Permanent Human Resources 3,128,479 Lord Krishna Bank / Singh Deputy Vice President 216 Prashant Kumar VP - Business Head’s MBA 42 15-Dec-03 21 Permanent Operations & 3,503,021 Xerox Modicorp. Limited / Goswami Office Management Head of Technical Support 217 Prashant Veer VP - CCT B.E. 39 13-May-04 15 Permanent Technology 3,443,722 Net Vision Cybertech Limited / Singh Services AVP Infrastructure 218 Puneet Garg VP - Technical B.E./B.Tech 40 30-Jan-06 17 Permanent Technical Services 4,263,964 Lucent Technologies / Asst. Director - NOS 219 Puneet Tandon GM - Finance CA 43 15-Feb-01 19 Permanent Finance 2,948,314 National Panasonic / & Accounts Manager Finance 220 R Ganesh GM - Network MBA 39 1-Aug-05 13 Permanent Technical Services 2,650,697 Nera Telecommunication (India) Private Limited / Sr. Manager - Engineering 221 R K Bhardwaj GM - SCM PGDM 50 10-Jan-07 26 Permanent Supply Chain 2,965,263 Lenovo IBM (India) Private Management Limited / Head Supply Chain 222 Raghav Rao Head - VSAT MBA 45 1-Apr-05 20 Permanent Sales & Marketing 5,011,041 Comsat Max / General Manager 223 Raghunath CEO - MO Rajasthan PGDM 42 29-Sep-03 18 Permanent Operations & 8,529,683 Hindustan Lever Limited / Mandava Management Operations & Marketing Manager 224 Rahul Gupta CSO - Mobility CA 43 1-Dec-06 21 Permanent Customer Service 9,912,596 GE Capital Business Process Delivery Mgmt Service Limited / Vice President 225 Raj Kishore VP - CSD ICWA 44 8-Mar-04 15 Permanent Customer Service 3,862,768 GE Consumer Finance / Prusty Delivery Regional Manager - Collections 226 Rajalakshmi Vijay DGM - CIG CA 44 31-Dec-02 20 Permanent Customer Service 2,584,991 National Insurance Company Delivery Limited / Administrative Officer 227 Rajan JS Kahlon GM - Global B.E./B.Tech 38 9-Aug-06 14 Permanent Sales & Marketing 2,700,764 VSNL / Dy. General Manager Data Business

228 Rajan Swaroop Executive Director - B.E. & MBA 52 15-Nov-04 26 Permanent Business Head 12,563,683 Escotel Mobile Comunications NSBU Limited/ Chief Executive Officer and Executive Director 229 Rajat Jain GM - E-tize PMO & MBA 40 22-Mar-04 14 Permanent Technology 3,728,654 Spice Communications Limited / Special Projects Services General Manager 230 Rajeev Chawla GM - Finance PGDBM 35 4-Mar-02 3 Permanent Finance 2,617,888 Escotel Mobile Communications & Accounts Limited / Asst. Manager 231 Rajesh Agrawal Head - Sales & B.E. & MBA 39 5-Nov-01 15 Permanent Sales & Marketing 2,521,824 Philips India Limited / Manager Marketing Marketing And Sales 232 Rajesh Khanna VP - Client Service M.Sc 46 1-May-06 19 Permanent Customer Service 4,888,524 Telcordia Technologies Inc. / Management Delivery Marketing Head

1 Director Report 39-67.p65 56 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 4 aarsn ed-Austo GM3 0Jn0 1PraetSls&Mreig26682CocaCola/RegionalManager TeletechServicesIndiaLimited/ 2,646,862 4,271,617 Sales&Marketing 29 & Operations Permanent Permanent 11 3-Nov-00 21 54 30-Jun-06 35 31-Oct-07 MBA 44 PGDM VP-Networks Aquisition - Head Ramamurthy MBA 249 Ramakrishna J 248 BusinessHead- RakeshVaidya 247 Convergys India / 3,250,466 Customer Service 15 Permanent 12 10-Feb-98 40 B.E./B.Tech 14-Jun-07 39 Head-CSD PGDBA Rajesh Kumar GM-CSOWholesale 234 Rajesh Kumar 233 5 aaa P-SlsPDM3 -u-414 2-Aug-04 36 PGDBM VP-Sales Ramanan 250 4 aehKmrG ewrsMA4 0Jl0 0PraetTcnclSrie ,3,3 HarrisStarex/GeneralManager 5,031,737 TechnicalServices BSNL/ Permanent 4,185,017 TechnicalServices 20 Permanent 19 20-Jul-07 CastrolIndiaLimited/ 45 6,459,120 RelianceInfocommLimited/ 3,193,159 1-Apr-06 & Operations AmericanExpress/Manager 4,598,553 & Operations 41 Permanent CustomerService MBA Permanent M.Tech/MS GM-Regulatory, Permanent 18 GM-Networks Rakesh Sharma 16 246 ABNAmroBank/VicePresident Rakesh Kumar 3,701,144 21 245 Previousemployment/ VP-Technical CustomerService Rakesh Kumar 244 12-Sep-07 Gross Permanent 41 2-Mar-04 1-Nov-04 41 16 44 Nature MBA MBA of Nature 6-Jul-06 B.A. CEO-MOTN 37 Marketing - GM Total RajivRajgopal 238 (Hons) B.A. Mitra Head-CSD Rajiv 237 RajivKBose of Date 236 Age VP-Service (s) Qualification RajeshSahana 235 Designation Name No. Sl. 4 ans ig r P-FnneC 02-e-11 emnn iac ,3,1 SpiceCommunications Limited/ 5,935,119 Finance SunReach HRConsultants/ Permanent 3,346,148 Human Resources Escotel Mobile Communications 15 5,464,154 Permanent BNPParibasBank/ 20 Operations & 3,281,932 26-Sep-01 Sales&Marketing Permanent 40 Permanent 15 1-May-03 20 47 16 CA 4-Aug-06 28-Jan-03 36 19-Feb-03 41 Sr.VP-Finance MBA 38 RajnishSingh B.E./B.Tech 243 DGM-VSATProduct BA(Hons) ChiefOperatingOfficer Rajnish Sharma 242 GM-HR Rajnish Kaul 241 MFC ProductHead-VAS Rajiv Talwar 240 RajivSehgal 239 6 en gawlDM-Bsns B 89Jn0 emnn prtos&27313Escotel MobileCommunications 2,753,103 Operations& Reliance TelecomLimited/ JCBhalla& Co.Chartered KoshikaTelecomLimited/ 2,706,178 2,602,623 3,639,070 Permanent Sales&Marketing CustomerService Permanent Permanent 5 Finance 14 16 Permanent TCILBellsouth Limited/ 6,585,559 9-Jan-02 Reliance Communications Limited / 13 2,630,056 TataTeleservicesLimited/ 38 24-Dec-01 2,662,661 Service Customer 1-Aug-00 TechnicalServices 37 37 Finance Permanent RelianceInfocommLimited/ Permanent 10-Nov-00 2,534,801 Permanent MBA 34 CentreForDevlopmentof Marketing & Sales 18 2,596,032 PGDBM 19 TataTeleservices Limited/ Erricson IndiaLimited/ 29 3,166,069 CA 5,227,325 Permanent DGM-Business TechnicalServices Reena Aggarwal 265 Technology Head-Sales& 21 RavindraSingh Permanent Technology CA 2-Jul-07 264 3-Sep-01 Permanent Head-CSD 17-Apr-95 40 IserveIndiaSolutions Ravindra Kumar 40 2,598,949 Permanent 53 263 17 TechnicalServices 18 GM-Finance 31-Dec-07 M.Tech/MS RavinderBansal 21 44 262 Permanent Diploma / Group Raksha Head CS Regional RaviRamaswamy GM-Legal 2,503,172 261 9-Jan-06 Avaya/ Marketing & Sales 18 CA DGM-Network 1-Sep-04 3,192,868 RaviParkash 40 260 Sales&Marketing 41 2-Aug-04 Permanent M.Sc Ravi Kumar Sr.VP-Finance 42 259 Permanent 29-Sep-03 23 Ravi Kaushal 258 Regional - RBH 43 M.Tech B.E. 18 RaviChandran 257 MBA DGM-Processes B.E./B.Tech Rashmi Mehrotra 18-Sep-07 256 VP-Technical GM-AppPlanning 43 RandeepSingh 29-Sep-06 255 42 Ramesh R 254 GM- Ramesh Chandra B.Sc 253 PGDBM GM-BidManagement Ramesh Bindroo 252 Business Zonal RamanandaSG 251 Kolluri Dudeja Baweja eiMarketing Negi Upadhyay Operations Gandhi Pattamatta Sekhon Seshadri Venkata SMB -Mobility Corporate & Audit/Compliance Data Business B2C Projects Operations and Development - MOAP Head’s Office Business Head Conformance Network Planning Manager-Chennai Zone 57 ..BTc 61Jl0 4PraetCsoe evc ,5,5 VSNL/HeadCustomerService 3,057,350 CustomerService Permanent 24 1-Jul-04 46 B.E./B.Tech ..BTc 83Mr0 7PraetLglSrie ,2,0 Reliance Communications Limited / 2,523,003 Services Legal Permanent 17 3-Mar-08 38 B.E./B.Tech of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement emnn ehia evcs5,9 TechnicalServices Permanent ModiXerox/Sr.ServiceEngineer 2,704,799 CustomerService Permanent otata employee or otherwise contractual emnn ae aktn ,1,6 AccentureServicesPrivate 3,513,565 Sales&Marketing Permanent emnn ehia evcs25152Hughes/Head-BSG 2,581,572 TechnicalServices Permanent 7/21/2009, 9:23 PM aaeetVicePresident Management Delivery Sr.Manager-Technology Delivery Delivery aaeetVP Head-Enterprise Management Management Delivery Vice President consAsst.General Manager-Finance & Accounts aaeetLimited/ Management eieyManagerCommercial Delivery aaeetLimited/ / Accountant Head-Ico Management & Accounts GeneralManager-Finance Delivery Telematics/ProgramManager Sr.Manager & Accounts Services Services 360SiemensPublicCommunication 73,600 VP Information&Broadband Networks Limited/ Jt. DeputyDirectorGeneral General Manager Regional SalesManager Product Manager-Prepaid Vice President Asst. Manager General Manager-Sales National Head Dy. GeneralManager-Netops Private Limited/ National Manager-Govt.Business Chief ExecutiveOfficer Limited /Mbb,Consultant Product-Contract Chartered Accountant Sales -Retail Head Sales Assistant Manager 57 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 266 Reena Tyagi Head - HR MBA 38 6-Aug-07 16 Permanent Human Resources 3,529,437 ABN Amro Bank / Vice President - Human Capital 267 Rohit Chopra GM - Finance CA 43 9-Jan-06 17 Permanent Finance 5,667,047 Aircel Digilink India Limited / & Accounts Head (Account) 268 Rohit Midha Zonal Business MBA 37 19-Jul-04 14 Permanent Sales & Marketing 3,424,519 Vijesh Marketing Pvt Limited / Manager Head South India 269 Rohit Relan GM - B2C Projects CA 39 4-Apr-05 15 Permanent Customer Service 3,006,043 Tata Teleservices Limited / Delivery Sr.Manager 270 Rohit Srivastava VP - IT B.E./B.Tech 40 28-Nov-07 17 Permanent Technology 3,411,890 Telmar Network Technology / Services General Manager 271 Rudra Dash Head - CSD MBA 46 13-Mar-06 22 Permanent Customer Service 3,260,808 Reliance / Head Operations Delivery 272 Rupam Bora GM - Application PGDBM 43 21-Aug-06 20 Permanent Technology 2,626,085 Reliance Infocomm Limited / GM Support Services 273 Rupinder Goel CIO, Enterprise MBA 49 17-Jul-06 24 Permanent Technology 7,565,122 I Soft Ppe Limited / Services Services Chief Information Officer 274 RVS Bhullar Chief Opearting Officer MBA 47 5-Feb-04 24 Permanent Operations & 5,153,753 Coca Cola India / Management Area General Manager 275 S Asokan Director - B.E (Mechanical), 51 7-Jun-06 24 Permanent Supply Chain 12,678,490 Eicher Good Earth Limited/ Supply Chain AICWA Management General Manager 276 S Balasubramanian CFO - North Hub CA 43 8-Aug-05 18 Permanent Finance 4,396,965 Coca Cola India / & Accounts General Chief Accountant 277 S Ganesan GM - Network - PGDHRM 52 29-Jan-01 29 Permanent Technical Services 3,565,248 DOT / Dy. General Manager Operations 278 S K Head - Finance CA 40 15-Nov-07 15 Permanent Finance 2,733,539 Cargill India Private Limited / Mukhopadhyay & Accounts Finance Contoller - Sales & Marketing 279 S K Sharma Sr. VP - Head BE B.E./B.Tech 53 9-May-03 32 Permanent Quality Services 6,752,248 GE Capital / Vice President - Quality 280 S Rajesh Head - Operations MBA 42 25-Apr-06 20 Permanent Sales & Marketing 4,177,396 Go Airlines (India) Private Limited / Vice President (Sales & Marketing) 281 S Sivaramakrishnan Head - Service M.Sc 56 1-Dec-03 30 Permanent Technology 6,732,614 Think Business Network Pvt Delivery Platform Services Limited / Vice President 282 S Sriram GM - Marketing PGDM 36 18-Oct-04 12 Permanent Sales & Marketing 2,609,096 Mother Dairy Limited / Marketing Manager 283 Sabu Verghese GM - Network - MBA 49 11-Jul-05 30 Permanent Technical Services 3,170,560 Reliance Infocomm Limited / Chief TNG Office Cluster Head 284 Sachin VP - Technical B.E./B.Tech 42 12-Mar-02 18 Permanent Technical Services 3,783,020 Siemens Public Comm. Limited / Deshpande Sr. Manager - Technical 285 Sachin R Sarna DGM - Sales MBA 35 13-Apr-05 14 Permanent Sales & Marketing 2,570,109 BPL Cellular Limited / Zonal Sales Manager 286 Sagar C Gosalia Head - Marketing PGDBM 36 20-Apr-07 13 Permanent Sales & Marketing 2,943,733 Idea Cellular Limited / Head - Marketing 287 Sagar Darbari Head - Marketing PGDTM 38 24-May-04 14 Permanent Finance 3,963,266 Tata Teleservices Limited / & Accounts Market Planning Manager 288 Salil Khanna Regional Business B.E. & MBA 41 11-Jul-06 21 Permanent Sales & Marketing 2,613,409 Reliance Infocomm Limited / Head Circle Lead 289 Sam Elangalloor CEO - Telemedia West PGDBM 44 2-Feb-04 19 Permanent Operations & 6,239,110 Zee Telefilms / Vice President - Management Sales & Marketing 290 Samarth Bakhru Head - Marketing PGDBM 33 22-May-00 10 Permanent Sales & Marketing 2,597,561 Woodstock Sound Corp / Sales Executive 291 Sameer Mathur National Sales PGDAM 38 1-Sep-06 12 Permanent Sales & Marketing 2,912,770 Pantaloon Retail India Limited / Vertical Head - Retail Area Manager - North 292 Samit Guha VP - Finance CA 39 17-Mar-04 18 Permanent Finance 3,494,880 Philips India Limited / & Accounts Factory Controller 293 Sandeep Behl CSO - Enterprise B.E./B.Tech 45 16-Jan-07 23 Permanent Customer Service 7,921,164 Hewett Pakward India Limited / Services Delivery Business Head 294 Sandeep Dhiman GM - Easy Charge, B.E./B.Tech 42 4-Jul-07 18 Permanent Technical Services 3,229,229 Datacraft India Limited / LAN WAN & Sr. Regional Support Manager Network Security 295 Sandeep Jwala GM - Network B.E./B.Tech 46 13-Nov-06 20 Permanent Technical Services 3,168,183 Shyam Telelink Limited / General Manager 296 Sanjay Bahl COO - MO HPHP MBA 46 1-Apr-96 26 Permanent Operations & 5,629,397 Casio Mobile Management Communication Limited / General Manager - Marketing 297 Sanjay Berry VP - Finance CA 40 2-Apr-07 16 Permanent Finance & Accounts 4,228,883 Patni Computers / VP - Finance 298 Sanjay Bhutani GM - CSD B.E./B.Tech 36 6-Apr-00 14 Permanent Customer Service 3,157,336 Fascel Limited / Project Manager Delivery 299 Sanjay Charan GM - Technical M.Sc 46 3-Oct-98 24 Permanent Technical Services 2,766,854 C Rly, BPL Div / Section Engr. Mathur

1 Director Report 39-67.p65 58 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 3 hmn ietr-Itra ahlro 03-o-72 otatAdt&1,4,4 Telstra Corporation,Australia/ 11,845,445 EscotelLimited/ChiefTechnical BPLMobile Limited/ 10,270,731 PenguinBooksIndiaLimited/ AudIt & Technical Services 6,205,185 10,943,946 Permanent Contract & Operations & Operations JaypeeHotels/ 26 Satyam Infoway/FieldExecutive Permanent Permanent 27 3,862,353 3,519,820 Sales&Marketing 24 18 Operations& Permanent ShogiCommunications/Director 19-Apr-04 30-Nov-07 2,657,041 Permanent 50 50 TechnicalServices 15 15-Oct-93 12-Jan-06 19 BonsaiNetworks/ B.E/B.Tech Permanent 46 42 3,197,717 Bachelor of Indraprastha MedicalCorporation TechnicalServices 3,441,234 HughesEscortsComm.Limited/ IdeaMobileCommunication/ CTO - Telemedia Human Resources 11 Director - Internal 28-Jan-02 5,099,065 2,415,800 Shankar Halder Permanent TechnicalServices 15-Nov-97 42 332 Permanent 43 MBA CA CEO-TelemediaSouth Permanent 16 Shamini Operations LogisLubenetSolutionsPrivate 331 11-May-05 18 2,520,351 COO-Telemedia 34 Shamik Das Sales & Marketing B.Com Permanent 12 330 PGDBM Tata TeleservicesLimited/ ShaileshA 4,352,159 Permanent 329 B.E./B.Tech 7-Jun-04 14 COO - Telemedia Customer Service Regional RBH- Shailendra Singh 36 3-Jul-06 328 16-Feb-07 12 43 Permanent 32 Shaikhali B.E./B.Tech GM-VAS 327 27-Jun-03 TataTeleservicesLimited/ 19 41 SenthilKumar 2,496,656 B.E./B.Tech Becton DickensonIndia/ In 326 12-Nov-01 Technical Services 3,066,238 2,514,780 GM-Technical MBA 37 SelvinsonSJ Sales&Marketing 325 Technical - DGM Permanent Mittal PGDBM Saurabh 19-Jun-06 Permanent Officer Operating Chief 324 41 17 SaurabhGoel Audit 323 AF Ferguson/Consultant 15 MBA GM-HR 8,241,324 Patnaik Satyajit IdeaCellularLimited/ 322 Permanent 3,637,357 Zonal Business Sales&Marketing ICWA Operations& Sathya Prasad P Group 5-Jul-05 19 321 1-Aug-07 41 Permanent Permanent 19-Jun-06 SarvjitSingh 39 320 40 Head-CSD 19 B.E./B.Tech 23 SarabjeetKaur 21-Sep-98 319 B.E./B.Tech 39 CTO-MOGujarat SantPratapGoel MBA 318 19-Sep-05 -Technical SankaranarayananHead 30-Jan-94 317 DGM-Sales 41 44 Sanjive Sharma Head-Sales 316 CA SanjivMishra 315 Diploma RegionalVoiceHead SanjeevMahajan CS 314 GM-CAG Sanjeev Kumar 313 CEO-MOHPHP Sanjeev Kumar 312 309 Sanjeeb Kalita Head - CSD MBA 39 15-Apr-05 14 Permanent Customer Service 2,739,531 Accenture / Consultant / Accenture 2,739,531 StandardCharteredBank/ TataTeleservicesLimited/ CustomerService 4,000,319 5,203,080 Technical Services Permanent / Motorola Operations& Permanent 2,706,400 14 Permanent 20 SupplyChain Convergys/ 17 2,871,765 Permanent 15-Apr-05 MahindraBritishTelecom/ 24-Aug-06 2,511,999 39 21 44 IngramMicroIndiaLimited/ 7-Aug-06 7,255,515 Finance 18 TechnicalServices 40 Technology M.Tech/MS Permanent Permanent MBA 5-Feb-07 Permanent TeleTechServicesIndiaLimited/ ContinentalFloatGlass/Manager VP-Sales 27,087,433 4,652,508 43 Sanjeev Chhabra Finance & Accounts 14 1-Nov-06 311 19 14 CTO-East BusinessHead MBA 43 Sanjeev Bedekar Permanent 310 Head-CSD Permanent HindustanLeversLimited/ Kalita Sanjeeb B.E./B.Tech VP-Marketing 309 16,312,797 20-Aug-07 MBA 16 Sales&Marketing 30-May-06 19-Apr-05 38 Sanjay Sehgal 25 43 308 GM-Commercial 37 Permanent SanjaySaxena 307 B.E./B.Tech 13-Aug-98 GM-SCM B.E./B.Tech 19 SanjaySachdeva 306 45 DGM-AppPlanning 1-Mar-06 CA 47 Sanjay Rawal VSAT - Head 305 (Hons), B.Com 15-Mar-07 Mittal Sanjay GM-Finance 304 42 C.A. Sanjay Kumar 303 CEO Deputy B.E.&MBA PFO(WestHub) SanjayKapoor 302 Sanjay Jain Marketing Chief 301 SanjayGupta 300 l aeDsgainQaiiain()AeDt fTtlNtr fNtr rs Previousemployment/ Gross Nature of Nature Total of Date Age (s) Qualification Designation Name No. Sl. aaigmAsrneCommerce Assurance Ramalingam West Kantak BusinessHead Barodawala Soyeabali Balasubramaniam FCIMA, MBA CMDsOffice Dhillon Venkataraman Sood Saxena Services South Central Zone Manager-TN & Marketing & Conformance Officer 59 ietr-BA(os,4 29-Jun-01 43 B.A.(Hons), Director - ..BTc 31-a-22 emnn ehia evcs52496DOT/Dy.GeneralManager 5,264,996 TechnicalServices Permanent 29 12-Jan-02 53 B.E./B.Tech B 11-c-018 16-Oct-00 41 MBA MBA of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement 1PraetFnne3,0,6 BritishTelecom / 34,406,065 Finance Permanent 21 / Btnaccess 2,787,055 Sales&Marketing Permanent 15 emnn prtos&34221ProcallLimited/ 3,422,291 Operations& Permanent emnn upyCan25030HeroMotors/ 2,580,300 Supply Chain Permanent otata employee or otherwise contractual 7/21/2009, 9:23 PM opineNationalManager, Business Chief Compliance Management Accounts Manager & Compliance Management aaeetFinance Manager- Sales &Marketing Management Management TeamLead Management GeneralManager,Head- Delivery Sr.Manager Sales Management aaeetDy.GeneralManager-Materials Management aaeetNationalSalesManager S.I.ProcurmentManager Delivery Manager-TechnicalInfrastucture Management Sr.Manager -Finance Management Services & Accounts Officer capability &Solutions Technical Head Asst. GeneralManager Limited /Sr.GeneralManager Limited /UnitLeader ED &ChiefFinanceOfficer Manager Regional Manager Manager-National Accounts Dy. General Business Dev.Manager Customer Care Vice President Head-Sales President &CEO Head Marketing(GM) Management vest IndiaEconomicFoundation/ Operating Officer Administrator 59 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 333 Sharad Gupta Head - CSD - East B.E./B.Tech 46 3-Sep-98 25 Permanent Customer Service 4,580,726 Thames Technologies / Delivery Dy. General Manager (Sales) 334 Sharan Shetty GM - Marketing MBA 41 4-Jun-07 14 Permanent Sales & Marketing 3,080,063 Levis Ci / Business Head 335 Sharlin Thayil COO - MO Gujarat PGDBM 47 28-Dec-00 23 Permanent Operations & 7,417,296 Bilt / Management Deputy General Manager - South 336 Sharma Kumar Head - Sales MBA 43 9-Apr-07 20 Permanent Sales & Marketing 5,088,887 Reliance Communications Limited/ Sanjay Sales - Head 337 Shashi Arora CEO - MO Delhi B.E. & MBA 44 1-Feb-06 18 Permanent Operations & 7,794,162 Kotak Mahindra Bank / Management Group Head - Marketing 338 Shefali Malhotra GM - Finance CA 36 1-Mar-00 13 Permanent Finance 2,716,165 Airborne Express / & Accounts Manager - Accounts 339 Shiben Das VP - Technical M.Tech/MS 40 22-Jan-01 15 Permanent Technical Services 4,167,586 DOT / Deputy General Manager 340 Shishir Kumar CEO - MO Bihar PGDM 45 31-Aug-06 22 Permanent Operations & 7,215,859 Beta Healthcare International & Jharkhand Management Limited / Chief Operating Officer 341 Shivan Bhargava COO - MO Orissa PGDBM 40 10-Oct-03 17 Permanent Operations & 4,951,673 Coca Cola India / Regional Management Logistics & Planning Manager 342 Shrirang N Bijur Sr. VP - SCM MBA 56 12-Feb-07 35 Permanent Supply Chain 5,230,624 Reliance Capital Limited / Management Sr. Vice President 343 Shweta Tangri GM - Compensation MBA 33 19-Feb-07 9 Permanent Human Resources 3,875,558 Ernst & Young / Manager & Benefits 344 Shyam Prabhakar VP - Technical B.E. 38 20-Sep-01 20 Permanent Technical Services 5,412,036 C-DOT / Research Engineer Mardikar 345 Sonal Kapasi VP - Business CA 37 3-Jan-00 17 Permanent Operations & 3,506,634 A F Ferguson & Co. / Performance Management Assistant Consultant Management 346 Soumya Ranjan GM - Technical B.E./B.Tech 42 5-Apr-07 12 Permanent Technical Services 2,951,521 Ecnet / Manager Jena 347 Sreedhar Krishna Principal Financial MBA 38 1-Jul-02 13 Permanent Finance 3,702,464 AFL Private Limited / Menon Officer & Accounts Manager - Accounts 348 Srikanth GM - Sales MBA 44 10-Sep-01 22 Permanent Sales & Marketing 2,910,301 PC India Private Limited / Subramanian General Manager 349 Srinath Shetty DGM - Zonal MBA 40 17-Jan-05 17 Permanent Customer Service 2,737,733 Metro Media Technologies / Operations Delivery National Sales Manager 350 Srinath Vedula GM - HR PGDBM 48 20-Feb-06 23 Permanent Human Resources 3,676,956 Tata Teleservices Limited / General Manager 351 Srinivas N Head - Marketing MMS 42 24-May-01 21 Permanent Sales & Marketing 3,098,179 Mahindra Hotels& Resorts / Divisional Manager - Marketing 352 Srinivas S Vemuri GM - Technical MBA 40 11-Jul-98 18 Permanent Technical Services 3,379,759 Vizag Steel Plant / Lecturer 353 Sriram T V VP - Networks PGDM 40 2-Feb-01 12 Permanent Technical Services 4,620,598 Comverse Network Systems / Systems Engineer 354 Subir Jana VP - SCM B.E. & MBA 41 16-Apr-07 17 Permanent Supply Chain 4,845,607 Tata Autocomp Limited / Management General Manager 355 Sudeep Banerjee VP - HR MBA 39 21-Feb-05 17 Permanent Human Resources 4,120,178 Aventis / General Manager-HR 356 Sudhanshu Datt GM - SCM Diploma 43 1-Nov-06 21 Permanent Supply Chain 2,515,743 Genpact / Asst VP Management 357 Sudheendra GM - President’s PGDBM 36 2-Jan-08 11 Permanent Operations & 3,320,570 Infosys Technologies Limited / R Magdal Office Management Principal 358 Sudipto COO - MO Assam B.Sc 45 16-Jun-03 23 Permanent Operations & 6,244,652 Bharti Hexacom Limited / Chowdhury Management Vice President 359 Sugumaran J Sr. VP - Chief B.E./B.Tech 53 24-Jul-00 29 Permanent Technical Services 6,514,138 BPL Mobile Network Officer Communications Limited / Head Network Performance 360 Sukesh Jain Chief Operating MBA 41 1-Jun-00 17 Permanent Operations & 4,212,006 Procall / Sr. Manager Officer - AES North Management 361 Sukhdeep Singh Head - Technical B.E. 37 8-Feb-05 16 Permanent Technical Services 2,513,018 Tata Teleservices Limited / Gill Sr.Manager 362 Sukhjit Singh Head - HR (AES) MBA 37 7-Mar-07 15 Permanent Human Resources 4,292,981 Pepsi / Vice President - HR Pasricha 363 Sundararaman P Head - Finance ICWA 40 12-Dec-05 16 Permanent Finance & Accounts 4,587,117 Subhiksha Trading Services / Vice President 364 Sunil Bharti Mittal Chairman and Graduate 51 1-Oct-01 23 Contract General 208,966,418 Bharti Cellular Limited / Managing Director Management Chairman and Managing Director 365 Sunil Colaso COO - MO UPU MBA 42 1-Oct-02 18 Permanent Operations & 6,871,076 Max Healthcare / Management Dy. General Manager- Marketing 366 Sunil Mishra Head - Marketing MBA 37 6-Aug-07 14 Permanent Sales & Marketing 4,338,871 Reliance Communications Limited/ National Head 367 Sunil Rajapurohit GM - Service B.E./B.Tech 37 2-Jul-07 14 Permanent Technology 3,087,075 On Command Video Corp. / Fulfillment & Assurance Services Architect, Software Developer 368 Sunil Singh DGM - Sales/Channel B.E / B.Tech 40 1-Dec-04 16 Permanent Sales & Marketing 2,659,051 Unicom Infotel / Director - Sales & Acquisition

1 Director Report 39-67.p65 60 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 0 io ed-Mdr rd B 81-o-41 emnn ae aktn ,2,1 Reliance InfocommLimited/ 2,726,310 Sales&Marketing Permanent 18 15-Nov-04 38 MBA Head-Modern Trade RegionalHead-West VipinGupta 403 Vinod 402 9 iiaTkoDM-H GB 75My0 3PraetHmnRsucs26242Nestle India/ WhirlpoolOfIndiaLimited/ 2,692,422 4,454,820 Human Resources Sales&Marketing HFCL InfotelLimited/ 2,511,114 Escotel MobileCommunications Permanent Permanent Sales&Marketing 3,153,249 CustomerService Permanent 13 18 SatyamInfowayLimited/ Permanent 3,908,263 15 HutchIndia/AVP-Sales& Sales&Marketing 7,272,894 15 10-Jun-04 5-May-03 Sales&Marketing Permanent 42 37 SpiceTelecommunications/ 28-Jun-04 Permanent Hindustan LeversLimited/ 3,754,962 8,069,829 12 TechnicalServices 35 IdeaCellularLimited/ 2-Dec-03 Human Resources 2,609,730 19 PGDBM 37 Permanent Sales&Marketing MBA Permanent GM- 21-Mar-07 Permanent Vinod Mukundan 15 CMO-SouthHub 401 B.A. 37 27 22-Aug-06 PGDBM OptelTelecomLimited/ DGM-HR Vinod Kumar 5,425,747 42 13 400 Technical Services Tikoo Vinita DGM-Sales 399 Compaq/AreaManager 13-Jun-05 StandardCharteredBank/ Permanent 2,794,199 Head-CSD 5,626,584 1-Mar-07 37 MBA Viney Tandon Reliance InfocommLimited/ Sales&Marketing 398 Sales&Marketing 3,964,340 25-Feb-02 49 MBA Marketing & Sales Reliance InfocommLimited/ 21 Jain Vineet 35 397 Permanent 2,497,811 B.E./B.Tech Marketing Permanent - VP CMO - Telemedia CustomerService Khanna Vikrant Permanent 396 B.E./B.Tech PGDPM 21 GM-Technical 8 VikasSingh Permanent TataTeleservicesLimited/GM 15-Dec-97 395 14 3,275,091 Marketing - DGM 46 1 VikasMalik Customer Service 394 19 56 Head-HR, VikasKaul 2-Mar-00 393 Permanent 16-Apr-01 B.A.,LLB,FCS 42 31 M.Tech 4-Jul-03 Vikas Joshi 392 36 18 14-Feb-05 1-Apr-05 Group General 43 46 Vijaya Sampath VP-Network 391 Diploma PGDBM VijaiPrakash PGDBM 390 Sales/Carrier - GM 29-Sep-06 VidyaSagarK 11-Apr-05 GM-Marketing 39 B.Com 389 B.Sc 46 Marketing - GM Rattan Vidur 388 Venkatesh CSD - Head 387 PGDBM GM-CAG BA Naidu Venkat 386 Vasudevan 385 Head-CSD Varsha Kothwale CEO-MO 384 Venkatesh V 383 381 Umesh Gupta VP - IT PGDSM 40 12-Dec-06 18 Permanent Technology 5,210,520 Equinox / Equinox 5,210,520 Technology Permanent 18 InterwaveCommunications/ 5,424,549 TechnicalServices ValueLabs/Manager 3,226,034 Sales&Marketing Permanent QTIL/Head Operations 12-Dec-06 3,609,209 40 Permanent CocaColaInternational/ 29 14,543,450 SupplyChain 17 Business Head OmanMarketing&ServicesCo./ PGDSM Modi Xerox/Head-Outsourcing 3,163,173 Permanent 5,618,289 Sales&Marketing 15-Nov-02 Permanent 19-Oct-01 53 22 35 Permanent Operations& 1-Mar-04 21 GM-Technical/ISP 40 M.Tech/MS V Seetharaman Permanent VP-IT 382 22 B.E./B.Tech 25-Sep-06 UmeshGupta 381 38 21 44 GM-Command Diploma South - CTO TKKumarAnand 2-Jul-07 380 14-Jun-04 45 Soni Tarun 45 Marketing - GM MBA,Advanced 379 TKVaradarajan MMS 378 4-Nov-03 - Director Executive MBA 43 CMO-NorthHub Syed Safawi 377 MBA B.E.&MBA Swarn Bajaj Head-SCM 376 SushilGrover VP-SalesOps 375 Head-CSD SureshJangid 374 Surendran C 373 7 ua aaG ae ZM ..&MA3 -a-31 emnn ae aktn ,0,9 GodrejSaraLeeLimited/ 2,906,990 SiemensInformationSystems/ Sales&Marketing 2,968,765 RelianceInfocommLimited/ Sales&Marketing 7,532,354 Permanent Permanent & Operations 11 16 Permanent 22 3-Mar-03 35 9-Feb-04 37 B.E.&MBA 4-Nov-03 48 VP-MarketResearch (ZBM) Sales - GM Surekha Poddar 372 MMM SurajSaha 371 Marketing/ - GM MBA Mehrotra Suphal Officer Operating Chief 370 SunilTandon 369 l aeDsgainQaiiain()AeDt fTtlNtr fNtr rs Previousemployment/ Gross Nature of Nature Total of Date Age (s) Qualification Designation Name No. Sl. Radhakrishnan Giyal Operations Tripathi Vijay Raghavan Padmanabhan Partner Governance Services Transformations Company Secretary Counsel & Sales AES West Karnataka Network O&M ot Management Centre/CCT North Product Management - MOMaharashtra ehooyBE/.eh4 5Jn0 6PraetCsoe evc ,7,1 HewlettPackard / 2,674,715 Customer Service Permanent 16 25-Jun-07 41 B.E./B.Tech Technology 61 ilm 73Ot0 12 3-Oct-01 37 Diploma B.E./B.Tech 49 1-Mar-02 19 Permanent Technical Services 2,664,524 BSNL(DOT) / SDE / BSNL(DOT) 2,664,524 TechnicalServices Permanent 19 1-Mar-02 49 B.E./B.Tech Program B 31-c-62 Permanent 20 17-Oct-06 43 MBA 7Ot0 6PraetSls&Mreig44801Spice 4,408,011 Sales&Marketing Permanent 16 27-Oct-03 of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement Jn0 4PraetLgl&1,0,5 Ranbaxy Laboratories/ 14,007,558 Legal & Permanent 24 -Jan-04 5PraetAdt25342HindustanAeronauticsLimited/ 2,523,492 Audit 11,666,338 Permanent Operations& 25 Permanent 23 4PraetCsoe evc ,3,9 IntersolutionsIndia/ 2,636,493 Customer Service Permanent 14 emnn ehia evcs28115HughesTelecom/Asst.Manager 2,881,145 TechnicalServices Permanent otata employee or otherwise contractual 7/21/2009, 9:23 PM eieyOperationsManager Delivery evcsManager Services eieyLimited/ChiefManager-S&M Delivery VP(Legal&Secretarial) Secretarial HeadCustomerCare Delivery Delivery Management evcsChiefInformationOfficer ProjectManager Services Delivery Management Management MillwardBrown/Regional 3,297,627 Marketing & Sales aaeetHeadKeyNationalAccounts Management Cluster Head Regional SalesDirector Corporate TrainingManager Sr. Manager-Sales Business Head-Utilities Marketing Operations Dy. GeneralManager Key AccountManager Personnel Manager Project Lead Management Trainee Product Manager-Marketing HLL /MarketingManager Project Director Chief ExecutiveOfficer Country Manager& Sales Manager(ConsumerElectronics) General Manager Director -RoyaltySolutions Area SalesManager Bussiness Manager Communications Limited/ 61 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 404 Vir Inder Nath GM - PCO PGDBM 36 23-Apr-07 13 Permanent Sales & Marketing 3,480,668 Idea Cellular Limited / Dy. General Manager 405 Vishal Gupta GM - CSD PGDIM 38 5-Nov-01 20 Permanent Customer Service 2,689,001 BSNL / Delivery Jt. Deputy Director General 406 Vishal Gupta VP - SCM B.E. & MBA 39 12-Jul-99 14 Permanent Supply Chain 3,816,633 Birla AT&T Communication / Management Assistant Manager 407 Vishal Sehgal COO - MO J&K MBA 41 14-Jul-05 17 Permanent Operations & 7,060,017 Reliance Infocomm Limited / Management Head-Cluster Sales & Operations & Business Head Post Paid Business 408 Vivek Madan GM - Networks B.E./B.Tech 36 1-Aug-01 17 Permanent Technical Services 2,904,200 Band-X Limited / IP Consultant 409 Vivek Saxena GM - Network B.E./B.Tech 40 15-Oct-01 19 Permanent Technical Services 3,403,770 Hughes Telecom / Sr. Manager

410 Vivek Sharma GM - Finance CA 41 3-Apr-07 17 Permanent Finance 2,862,681 Tata Teleservices Limited / & Accounts Sr. Manager - Finance 411 Yatish Mehrotra COO - MO Karnataka B.E./B.Tech 38 11-Apr-03 18 Permanent Operations & 6,605,288 Escotel Mobile Management Communications Limited / General Manager - Marketing 412 Yogesh Gulabani GM -Technology B.E./B.Tech 39 3-Oct-06 12 Permanent Technology 2,737,343 Colt Technology Services Services Services (I) Pvt Limited / Manager - IT Operations & Services (B) EMPLOYED FOR PART OF THE FINANCIAL YEAR 1 A S Pillai VP - Marketing B.E / B.Tech 42 7-Jul-08 21 Permanent Sales & Marketing 3,216,047 Datacraft India Limited / Head - Professional Services 2 Abdul H Khaleeli Voice Head Graduation 38 15-Nov-07 15 Permanent Sales & Marketing 391,904 Tata Teleservices / Sr. Manager 3 Abhimanyu Sen GM - IT B.E / B.Tech 41 15-Dec-08 19 Permanent Technology Services 869,781 Accenture / IT Projects Delivery 4 Abhishake Garg Sr. Manager - B.E / B.Tech 36 2-Nov-05 14 Permanent Technical Services 515,382 Reliance Infocomm Limited Technical 5 Ajay Malwade GM - Engagement PGDRP 50 25-Jun-07 26 Permanent Technology Services 695,068 Wipro Infotech / Sr. Consultant & Operations CSD 6 Ajay Satyarthi Head - CIN BA 40 1-Feb-00 18 Permanent Technology Services 2,132,896 TCIL / Computer Engineer 7 Ajay Sohanvi Manager - Purchase BA 33 8-Nov-04 14 Permanent Supply Chain 620,506 Ajanta Offsets / Management Production Executive 8 Akhil Gupta Joint Managing CA 53 1-Sep-03 27 Contract General 32,755,356 Consultancy Director Management 9 Akhilesh Saxena DGM - BE MBA 35 24-Nov-05 14 Permanent Quality Services 550,072 Wipro / Program Manager 10 Alan Meldrum Head - Commercial - Post Graduation 50 28-Jan-08 18 Permanent Finance 2,159,469 Orange Business Services / AES (Phychology) & Accounts Commercial Manager - Asia Pacific 11 Alok Goyal VP - SCM M.Tech / MS 44 30-Nov-08 23 Permanent Supply Chain 1,652,489 Senergy Global Limited / Management Head - Carbon Credits 12 Amar Misra DGM - Sales MBA 40 20-Mar-07 15 Permanent Sales & Marketing 492,828 Idea Cellular Limited / Sr. Manager 13 Amardeep Misra DGM - Technical B.E / B.Tech 40 1-Aug-06 15 Permanent Technical Services 762,611 Hutchison Essar Limited / Stategic Planning Sr. Manager

14 Amit Mittal DGM - Business CA 33 23-Sep-02 7 Permanent Finance & Accounts 1,490,006 Gateway Systems Pvt Limited / Plannning & Analysis Manager Accounts 15 Anadi Agnihotri DGM - Marketing PGDBM 39 15-Sep-08 9 Permanent Sales & Marketing 1,308,206 Sutherland Global Services / Director-Service Delivery 16 Ananthalakshmi Head - HR & Admin MBA 37 15-Oct-07 13 Permanent Human Resources 1,359,769 Target Services India Pvt Limited/ H Srinivasan Head - HR 17 Anil K Malhotra GM - Hub Delhi Diploma 59 11-May-95 34 Permanent Technical Services 3,519,382 Videsh Sanchar Nigam Limited / Dy. Engineer 18 Anish Antani DGM - Finance MBA 40 10-May-06 14 Permanent Finance 1,057,959 Tata Teleservices Limited / & Accounts Sr. Manager-Finance 19 Anshuman Kalia Sr. Manager - MBA 32 16-Jul-01 7 Permanent Sales & Marketing 693,936 Joined in Bharti Airtel Limited Marketing as Fresher 20 Anshuman Verma DGM - Marketing PGDCM 35 7-Aug-06 10 Permanent Sales & Marketing 731,618 ABN Amro Bank / AVP 21 Anuj Kohli Manager - ILD/Carrier B.E / B.Tech 31 1-Jun-05 3 Permanent Technical Services 386,242 Aircom International / Services Sales Manager 22 Anuj Mishra Asst. Manager - PGDBM 28 1-Apr-04 5 Permanent Sales & Marketing 933,335 Dishnes Dsh Limited / Sales Sales Executive 23 Anupam Jalote Chief Process MBA 45 1-Nov-04 20 Permanent Customer Service 2,512,352 Tata Services Limited / Officer Delivery Head - Customer Service Delivery 24 Archana Sasan VP - Legal LLB 45 12-Feb-09 16 Permanent Legal Services 1,372,771 GE Money Financial Services Limited / VP-Legal&Compliance 25 Arun Vohra VP - CSD M.Tech/MS 47 15-Oct-97 23 Permanent Customer Service 2,876,924 Oriflame India Pvt Limited / Delivery General Manager 26 Arvind Pandey CTO - AES B.E / B.Tech 47 25-May-05 26 Permanent Technical Services 3,491,022 Hutchison Max / General Manager

1 Director Report 39-67.p65 62 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 5Et ua r aae EMA3 -a-61 emnn ult evcs3795Deloitte &Touche/Manager AlcatelDevelopment India(P) 387,925 395,701 QualityServices Human Resources Permanent Permanent TheResidency Hotel/GM 2,678,169 10 16 AmwayIndiaEnterprises/ Operations& / Genpact 344,429 1,446,855 BritishTelecom/ 8,971,117 Human Resources Human Resources Permanent Sales&Marketing 4-May-06 1-Feb-06 Aptech Limited/ProfitCentre 33 Permanent Permanent 39 & B.E. 1,507,470 HDFCStandardLifeInsurance/ 18 Permanent 398,929 Human Resources PhilipsIndiaLighting/ 14 HTLLimited/ 9 Human Resources 2,749,453 13 Permanent 1,464,750 Reliance Infocomm / Human Resources TechnicalServices GM-SCM 15-Dec-97 MBA 894,130 MSW Permanent 18 40 Permanent Permanent Sales&Marketing 25-Aug-04 Sr.Manager-BE 9-Feb-09 18 9-Apr-08 Gaurav 33 37 Permanent 22 34 21stCenturyServiceDelivery/ 45 46 DGM-HR Ekta Kumar 14,390,639 45 Graduation Post 1-Aug-04 Customer Service 11 Dolly Grover Dabhol Power Company / BA 39 10-Jan-05 TataTeleservicesLimited/ 3,718,648 44 Sr.VP-Marketing PGDBM 1,286,147 42 MBA DeepakjitSingh Contract DGM-Operations 9-Dec-02 3-Jul-06 43 59 44 DeepakSethi Supply Chain 20-Mar-06 HR Manager Sr. 28 42 36 Finance MBA DeepakMishra PGDBA Permanent VP-HR Sr.Manager -Training 41 Permanent Deepa Chadha MBA 40 21 26-Sep-06 LLB Debojeet 20 52 GM - HR B.E. 39 Mgmt- Marketing Debashish Das 38 10-May-06 DGM-HR Dakshinamoorthi 44 Director-CSD 28-Aug-01 VP-HR 37 43 Carol Borghesi 36 ZBM Biswarup 35 M.Sc BijuRNaik 34 CA BalasubramanianV 33 Head-SCM Balasubramaniam Sr.VP-Finance 32 Avnish Jindal 31 1KSMrlda r aae GC 61Mr0 2PraetSls&Mreig2999Ogilvy &Mather/ 289,989 BSNL/Head-Technical Sales&Marketing 2,691,824 TechnicalServices Permanent Ericsson IndiaPrivateLimited/ 3,871,272 Permanent GEMoney/ TechnicalServices 7,493,970 12 AcmeTele Power Limited/ 1,965,401 39 Permanent Legal Services LegalServices HCLInfosystemsLimited Permanent Coca Cola India / 27 2,215,925 1-Mar-07 10,699,924 Sales&Marketing Permanent 28-Sep-01 36 Business Head 17 58 Permanent 16 Limited/ Kong) (Hong Buongiorno 18-Apr-05 Permanent 389,456 / Dyr Rediffusion 53 14 PGDCA RelianceInfocom Limited/ 348,449 KaniniConsultantsPvtLimited/ 420,138 18-Aug-08 1,483,975 21 Sales&Marketing B.Sc Sales & Marketing 43 SupplyChain Degree, Solicitor’s India/ Citigroup 1-Jun-07 Sr.Manager- 1,954,705 Permanent Permanent 40 23-Jul-04 K S Muralidhar Permanent B.E. GM-Network Director-Legal 61 40 22-Mar-04 K Muthanandam Finance 14 15 60 46 15 Pepsi FoodsPrivateLimited/ Head-Technical Jyoti Pawar Permanent Finance 4,299,908 Hindustan LeversLimited/ 59 MBA BE(Hon), 9,213,782 John Koshy PGDBM CS & B.E ExecutiveDirector- Permanent Compliance & 58 23-May-05 7 1-Aug-03 Jayant Khosla 36 Head-Channel& 9-Feb-09 38 57 Permanent 11 Marketing 39 JaideepKohli Legal - VP GM-SCM 56 B.E.&MBA Permanent 29 16-Feb-04 JagdishPrasad 55 34 MBA 19-Jan-09 JPSingh PGDBM 17 Sr.Manager-Brand VP-Marketing 54 35 IndrajitPakrasi 23-Feb-04 53 51 Hemanth GM-SCM 25-Sep-06 CA 52 Chutani Harsh 43 MBA Sr.Manager-BPA 51 CA,MBA HarmeetSingh VP-Treasury& 50 Head-Internal Kohli Harjeet MBA 49 Director-Marketing Harish Dua 48 Vittal Gopal 47 Consultant / TCS 1,569,743 TechnologyServices Permanent TataCommunicationsLimited/ 1,982,272 18 & Operations Permanent 29 6-Aug-07 17 38 14-Sep-98 GM-Fina 52 B.Tech & PGDM 17-Nov-08 PGDBM Gupta Atul 37 CorporateDirector- 30 Ashok Juneja B.Tech / B.E 29 Head-IT VP-BusinessHead AshishPrabhakar 28 Dutta Ashish 27 l aeDsgainQaiiain()AeDt fTtlNtr fNtr rs Previousemployment/ Gross Nature of Nature Total of Date Age (s) Qualification Designation Name No. Sl. Chatrath Goswami Uthirapathi Goswami S K Agarwal Kumar G Deveshwar Hastak rnia ehia . .eh4 0Jl0 0PraetTcnclSrie ,7,8 AircelLimited/GeneralManager 2,574,683 TechnicalServices Permanent 20 10-Jul-06 42 B.Tech / B.E Officer Principal Technical Commercial euaoyLLB Marketing & Regulatory Mobility West Acquisition Investor Relation Assurance Business Development 63 c/C 22-c-517 21-Oct-05 42 CA nce/ International & Delivery Managing Director Managing &Delivery International .eh4 4Ot0 22 14-Oct-04 42 B.Tech B 51-c-810 16-Oct-08 35 MBA of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement emnn upyCan16334NeutrogenaCorporation/ 1,643,344 Supply Chain Permanent emnn iac ,1,7 RelianceInfocommLimited/ 1,812,371 Finance Permanent emnn upyCan21582DataAccessLimited/Manager 2,115,862 SupplyChain Permanent Hutch 16,006,128 Business Permanent otata employee or otherwise contractual 7/21/2009, 9:23 PM aaeetGeneralManager Management Management ProjectLead & Accounts consDy.GeneralManager & Accounts aaeetDistribution& Management Head-GlobalAccess Management Management aaeetVicePresident Analyst Director-Corporate& Management VP(Corp.Planning) & Accounts & Accounts Internal Assurance ChiefOperatingOfficer Development Limited /Manager Head ofMedia&Broadcast State Trainer Vice PresidentHRSharedServices Sales TrainingManager Head -LearningBusinsess Dy. GeneralManager Director HR-India&Pakistan Cluster BusinessHead Account Director Senior VP-Legal&Compliance Project Consultant VP Operations,Mumbai Corp &CommercialLawyer Group AccountManager Director Vice PresidentFabricCleaningAsia Supply Chain Management &Feasibility Investment BankHead(East) ison –Max/ Logistics Manager, - Media 63 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 62 Kirtikar Ojha Regional Sales MBA 44 28-Sep-05 19 Permanent Sales & Marketing 2,331,766 Essar Spacetel Limited / Head - NCR General Manager 63 Kishore Gogar GM - Finance ICWA 49 7-Sep-96 20 Permanent Finance & Accounts 2,406,256 Hexacom (India) Limited / GM. 64 Krishan Mohan Head - IT B.E. / B.Tech 43 19-May-08 22 Permanent Technology Services 3,562,100 Genpact / Vice President Saxena 65 Krishnan G V CMO (East Hub) MBA 41 4-Sep-04 19 Permanent Sales & Marketing 1,827,918 Food World Super Markets Limited / GM - Operations & Merchandising 66 Kuntak Roy Principal Finance CA 40 10-Oct-08 10 Permanent Finance 1,469,952 Federal Express Corporation / Chaudhary Officer & Accounts Financial Controller (Manager) 67 Kunwar Kishore Sr. VP - ESBU MBA 49 18-Jun-08 24 Permanent Sales & Marketing 5,544,105 UCA Services Inc./ Arora Vice President 68 Lalit Nagpal GM - Finance ICWA 40 2-Sep-04 16 Permanent Finance 1,536,787 Tata Teleservices Limited / & Accounts Sr. Manager - Billing 69 Lokesh Suji Manager - Sales/Media MTM 34 6-Mar-06 14 Permanent Sales & Marketing 377,179 Sify Limited / Sales 70 Macharaja P DGM - Projects Diploma 42 12-Dec-05 23 Permanent Technical Services 913,412 Tata Teleservices Limited / Sr. Manager Networks 71 Madan Mohan Head - Sales MBA 50 18-May-04 26 Permanent Sales & Marketing 2,780,231 Coca Cola India / General Bajpai Manager-Sales & Distribution 72 Madhu Nori VP - IT BE & MBA 36 13-Oct-08 16 Permanent Technology 2,024,276 Independant Consultant / Services Telecommunications Consulting 73 Mandeep Bhatia COO - MO MBA 40 4-Dec-01 17 Permanent Operations & 4,716,159 Spice Communications Limited / Maharashtra Management VP (Nepal) 74 Manish Aggarwal GM - Consolidation PGDBM 36 18-Jan-06 12 Permanent Customer Service 1,329,137 Optimus Outsourcing Company / Projects Delivery AVP 75 Manish Dua Head - Voice Business MBA 40 28-Sep-06 18 Permanent Sales & Marketing 2,159,330 Tata Teleservices Limited / AES West General Manager 76 Manish Mamtani Head - IT B.E / B.Tech 40 5-May-08 18 Permanent Technology Services 3,907,507 Genpact / Vice President 77 Manish Saxena Principal Finance CA 43 28-Aug-06 18 Permanent Finance 1,932,229 Reliance Infocomm Limited / Officer & Accounts Project Commercial Head 78 Manmohan Daga Sr. Manager - MBA 36 16-Aug-05 13 Permanent Finance 845,415 Trident Group / Finance & Accounts Manager - Corporate Planning 79 Manmohan Saini Head - SMG M.Com 40 12-May-03 19 Permanent Customer Service 426,821 M/s Escotel Mobile Comm. Delivery Limited / Sr. Executive 80 Monicka Raj Head - Technical B.E. / B.Tech 55 12-Sep-01 31 Permanent Technical Services 3,510,789 Wipro Spectra Mind / Govindan Project Lead 81 Nagesh Rajanna CEO - UP MBA 44 12-Jul-07 20 Permanent Operations & 5,420,106 Pepsico India Holdings Pvt Circle Management Limited 82 Naveen Gupta GM - Marketing MBA 38 19-Feb-09 16 Permanent Sales & Marketing 339,218 Reliance Communications Limited/ Head - Strategic Planning & Alliances 83 Neeraj Arvind DGM - Business MBA 38 10-May-06 11 Permanent Operations & 694,535 Caretaker & Enterpreneur / Shah Analyst Management Proprietor 84 Niraj Mehta Manager - CSD PGCBM 36 26-Mar-07 15 Permanent Customer Service 314,034 Reliance Communications / Delivery Hub Head Service Assurance 85 Norman Don Director - Networks BE (U.S. Navy) 46 11-Feb-02 23 Permanent Technical 34,226,257 Nextel Partners / Director Price IV 86 P Swaminathan Chief Operating Officer B.Tech, PGDM 54 12-Jul-99 29 Permanent Business Head 4,930,114 BPL Cellular, Pune / Circle Head 87 P V V Srinivasa Cheif Marketing Officer BE & MBA 41 17-Jan-05 14 Permanent Sales & Marketing 3,489,569 Hero Motors / Rao - Telemedia Services Chief Operating Officer 88 Pankaj Nanda DGM - Finance CA 42 7-Jun-04 17 Permanent Finance 619,867 Reliance Infocomm Limited / & Accounts Commercial Head 89 Paresh S Yadav Sr. Manager - CSD B.E / B.Tech 37 10-Nov-05 12 Permanent Customer Service 348,228 E2E Serwiz Solutions Limited / Delivery Manager- Operations 90 Paroma Roy VP - Marketing Post Graduation 43 28-Aug-06 17 Permanent Sales & Marketing 3,747,574 Hewlett Packard / Chowdhury Lead Communications 91 Pawan Kumar GM - CSD ICWA 42 1-Mar-07 18 Permanent Customer Service 950,878 Reliance Infocomm / Rohatgi Delivery Head - Customer Service Delivery 92 Pawan Pratap GM - Technical B.E / B.Tech 40 1-Jun-05 21 Permanent Technical Services 2,059,095 Media Craft India Pvt Limited / Singh Account Executive 93 Pawan Trivedi Sr. Manager - Finance CA 31 22-Aug-06 6 Permanent Finance & Accounts 426,147 TDCA / Manager 94 Pradeep GM - IT PGDBM 41 22-Sep-08 17 Permanent Technology 1,381,949 Fidelity Business Services India Prabhakaran Services Private Limited / Sr. Manager Eledath 95 Prakash Sangam GM - Marketing and PGDBM 33 6-Aug-07 9 Permanent Sales & Marketing 1,993,954 Hindustan Unilever Limited / Innovation Regional Marketing Manager 96 Prasad Nambiar DGM - Sales MBA 35 3-May-04 11 Permanent Sales & Marketing 2,195,558 AT&T Easylink / Regional Sales Manager 97 Prashant Chacko DGM - Marketing PGDBA 32 25-Oct-04 9 Permanent Sales & Marketing 520,893 Axalto Schlumberger / Account Manager

1 Director Report 39-67.p65 64 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 3 ajyNnrjgEeuieDrco-BTc Ce) 78Jn0 2PraetItrainl29589Pepsico/MarketUnitDirector 2,905,829 International Permanent 22 CA 8-Jan-03 47 DGM-Finance/ (Chem), B.Tech Sanjeev Madan 131 Director- Executive Sanjay Nandrajog 130 2 ajyHSehS.Mngr-SMMA4 7Jn0 4PraetSpl hi 453,915 HutchisonEssarLimited/ 2,300,382 SupplyChain Customer Service Permanent Permanent HughesS/WSystems/Sr.Engg 470,848 14 Technical Services 19 Permanent 17-Jan-05 40 8 3-Mar-06 43 BE & MBA 13-Apr-01 MBA 33 Sr.Manager -SCM Sanjay HSheth 129 B.E/B.Tech Head-CSD Manager-Technical Sr. Sanjay Dakwale 128 Sanjay Bansal 127 2 ade P-SrtgcMA4 7Jn0 6Permanent 16 CromptonGreavesLimited/ 1,032,073 TechnicalServices 17-Jan-05 Permanent 44 26 MBA 2-Feb-05 52 VP-Strategic Sandeep 126 SandeepMirakhur M.E. 125 Manager-Technical Sr. SaiVaraPrasad 124 2 oi adnHa aktn GB 62-a-31 emnn ae aktn ,0,7 DaburIndiaLimited/ 1,802,671 VSNL/Dy.General Manager Sales&Marketing 848,992 Subhiksha TradingServices/ BhartiTelenetLimited/ CustomerService Permanent 509,480 247,224 Technical Services Permanent Army Headquarters / 11 3,665,731 & Operations Technical Services Permanent 22 Permanent Permanent 10 MonsantoCompany/ 23-May-03 1,722,792 Brands&Corporate 36 17 24 9-Nov-05 Permanent 43 7-Nov-02 PGDBM 36 21 19-Jan-09 HubCSO-West 2-Jan-03 39 Rupak Agarwal Marketing - Head 123 50 B.E/B.Tech B.Com Tandon Rohit Manager - Technical 122 M.Tech/M.S 2-Mar-09 Rizwan Khan 52 121 MBA CTO(NorthHub) DGM-CSD Ravinder Kumar VP-BusinessHead 120 RaviganeshV 119 MA,BA Corporate Head-Group Ravi 118 Ranjana 117 1 aehKum M-FnneMA4 2Jl0 7PraetFnne17827RelianceInfocomm Limited/ 1,738,257 TataTeleservices Limited/ PCSTechnologyLimited/ 2,283,148 577,472 Finance Sales&Marketing Permanent Permanent Finance GMSTechnologies/President& Ethopl/Dy. GeneralManager 6,081,002 2,520,649 SudtherlandGloservices/ 17 Permanent 3,211,999 10 BusinessHead Customer Service Technology 11 Permanent Permanent Permanent 12-Jul-05 6-May-05 NewHollandTractors/ 41 29 34 15 3,879,871 15 RelianceInfocomm/Head 2-Sep-03 PhilipsIndiaPvtLimited/ 1,561,883 1,467,521 36 Marketing & Sales Sales&Marketing Technology 29-Dec-00 Head-R MBA MMS 3-Sep-07 Permanent RanganathanM 51 Permanent Permanent 2-Apr-07 Graduate Post BA, 116 41 39 Manager-Sales/ Ramanand Kambli 18 115 14 GM-Finance 28 CA CEO-Small& Rakesh Khurmi 114 B.Com PGDCA Head-Finance Rajiv Kumar 113 24-Mar-05 13-Jun-06 16-Jan-03 RajeshSethi 44 39 112 54 VP-Contact GM-Central Rajesh Ramdas 111 BE & MBA Rajesh Ohri PGDBA 110 MBA Infrastructure, - Head RajeshKharbanda 109 DGM-Sales Sales - DGM RajendraSingh 108 RajeevKinder 107 105 Rahul Wadhawan Head - SMG B.Com 32 4-Jun-07 11 Permanent Customer Service 854,051 GE Capital Transportation Capital GE 854,051 CustomerService IdeaCellularLimited/ 1,335,982 Permanent Sales&Marketing Futuristic Himachal 11 2,539,481 Permanent TechnicalServices BPLMobileLimited,/ 1,294,542 16 Permanent Customer Service GlobacomNigeria/CTONgn/IP 4-Jun-07 Ogilvyone/Manager 1,286,105 32 2,109,849 Permanent 32 Sales&Marketing Sales&Marketing 30-Sep-05 39 19 Permanent Permanent B.Com 5-Jan-98 Sales - GM 14 9 58 RajKumarVK 106 22-Jan-04 B.Sc 43 B.Tech / B.E Head-SMG RahulWadhawan 105 29-Nov-08 2-Jan-02 ZonalBusiness (Hons) B.A. 39 RadhakrishnaA 35 Network - VP 104 M.S / M.Tech RKBabbar 103 DGM-CSD PGDAC Premraj Menon VP-Technical 102 PraveenSinghal 101 Head-Marketing Pratik Mazumder 100 l aeDsgainQaiiain()AeDt fTtlNtr fNtr rs Previousemployment/ Gross VSNL/Head-CustomerCare 390,046 TechnicalServices Nature Permanent of Nature 3 Total MBA 21-Aug-06 38 of Date VP-Business Age (s) Qualification Prasoon M.A. 99 Manager-Technical Prashanth Kumar Designation 98 Name No. Sl. Sawhney Popli Communications Ramchandran Smetacek hraMdu uiessin MediumBusinesses Sharma Distribution Bhatia rvsaaSolutionsIT Srivastava Karne Finance &Accounts nentoa prtosMBA International Operations & BusinessNPD Alliances M etHbBE/BTc 01Nv0 0PraetSls&Mreig18249ShyamAces PvtLimited/Head 1,822,419 Sales&Marketing Permanent 10 1-Nov-00 40 B.Tech / B.E CMO -WestHub & Brand Assurance Channel &Acquisition Operations Operations Console Special Project Governance and Manager 65 vneMCm3 7Jn0 12 27-Jan-00 35 M.Com evenue GB 42 PGDBM cnmc eieyZonalSalesManager Delivery 42 PGDQM Economics Arts, LLB,MBA 81-c-59Permanent 9 17-Oct-05 38 43Ot0 3Permanent 23 3-Oct-06 44 -c-42 emnn utmrSrie32586HTMediaLimited/ 3,265,886 CustomerService Permanent 21 4-Oct-04 0Ot0 0Permanent 20 10-Oct-05 of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement emnn iac 5,2 BCComponentsIndiaLimited/ 455,426 Finance Permanent otata employee or otherwise contractual 7/21/2009, 9:23 PM iac 8,2 CocaCola /Manager-Finance 585,427 & Accounts Finance Operations aaeetWHManager Management eieyGeneralManager Delivery ae aktn ,0,6 WeatherChannelInteractiveInc/ 3,507,965 Sales &Marketing eieyGM-StrategicMarketing Delivery omnctosDirector-InternationalComm Commercial Officer Delivery Communications & Accounts aaeetPresident Management ae aktn ,5,1 IqaraTelecomsIndiaPvtLimited 1,551,313 Marketing & Sales consCommercial Head Asst.Manager-Finance VicePresident & Accounts ChiefInformationOfficer & Accounts Delivery Services Services eieyFinancialServicesLimited/ Delivery ehooy5141TataInternet/VicePresident 571,401 Services Technology Spice CommunicationsPvtLimited/ Director-Business Development Chief TechincalManager Sr. BrandManager Asst.Manager Chief OperatingOfficer Asst. VicePresident Territory Manager Chief ExecutiveOfficer General Manager Sales andDistribution Asst. GeneralManager General Manager-CableDivision Communications Limited/ Assistant VP-RiskManagement 65 BHARTI AIRTEL ANNUAL REPORT 2008-09 Sl. Name Designation Qualification (s) Age Date of Total Nature of Nature Gross Previous employment / No. commencement experience employment, of duties remuneration designation of employment whether of the contractual employee or otherwise 132 Sanjeev Shekhar GM - Network M.Tech / M.S 36 15-Sep-08 14 Permanent Technical Services 1,401,701 Nokia Siemens Networks / Sahu Regional Project Director 133 Sanjeev Walia Sr. Manager - Sales MBA 30 2-May-05 9 Permanent Sales & Marketing 671,501 LG Electronics India Limited / Asst. Manager 134 Sapriya Malhotra Zonal Business BE & MBA 36 27-Mar-06 6 Permanent Sales & Marketing 1,623,919 Reliance Infocomm / Manager Cluster Head 135 Satish Laghate GM - Network B.E / B.Tech 43 8-Oct-97 21 Permanent Technical Services 2,893,680 DOT / DET Ahmedabad

136 Satish Sharma Zonal Business PGDGM 37 4-May-06 15 Permanent Sales & Marketing 1,449,956 Hutch / Manager Manager Zone Operations 137 Satyam Sharma Sr Executive - MIT 32 4-Sep-06 6 Permanent Technical Services 549,253 IBM / Project Engineer Technical 138 Shailendra Goel DGM - Sales MBA 38 22-Dec-03 13 Permanent Sales & Marketing 791,881 Samsung India Limited / Branch Manager 139 Shailesh Dudani Sr. Manager - MBA 34 1-Jul-05 11 Permanent Sales & Marketing 485,061 VSNL / Head - Bulk Services Sales 140 Shalini Gupta DGM - Broadband MBA 34 14-Aug-06 10 Permanent Technology 1,717,123 Aviva Life Insurance / and SMB Services Project Manager 141 Shankho VP - Sales Post Graduation 47 11-Jan-06 23 Permanent Operations & 3,409,945 Owned Media Solution & Chowdhury Management Marketing Company / Proprietor 142 Sharad Malik DGM - Retention MBA 37 10-Dec-04 12 Permanent Customer Service 1,122,500 Idea Cellular Limited / Delivery Sr. Manager 143 Shaun Parmar Corporate Director - CGA, 43 17-Jun-08 17 Permanent Business 9,499,082 Gildan Activewear / VP M&A & Business MBA-Finance, Development Development B.Sc. 144 Shilpa Wadhwa Sr. Manager - B.E / B.Tech 36 3-Oct-06 11 Permanent Technical Services 325,595 VSNL / Manager Engg. Technical 145 Shireesh Mukund Director - Marketing MBA, B.Tech 44 19-Jan-09 20 Permanent Marketing 4,751,790 PepsiCo International Greater Joshi China Foods/ VP Strategy & Business Transformation 146 Shyamal Mittra VP - Marketing MBA 40 22-Jan-07 16 Permanent Technology 1,235,439 Satyam Computer Services / Management Services Director - Telecom Software and Consulting 147 Sivaprakash DGM - Technical B.E / B.Tech 45 28-May-07 22 Permanent Technical Services 359,646 Nortel Networks / RF Expert Narayanan P 148 Sreeram DGM - Technical PGDTM 38 27-May-05 17 Permanent Technical Services 1,721,575 VSNL / Dy. General Manager Chakravarthy Gomadam 149 Srikanth Chief Financial Officer CA, B.Com 48 17-Nov-08 28 Permanent Finance 5,923,964 Hindustan Unilever Limited/ Balachandran Programme Leader – Global Finance 150 Srinivas DGM - Marketing MBA 38 4-Jun-07 13 Permanent Sales & Marketing 867,812 Idea Cellular / Bhattacharya Head of Fraud Management 151 Subroto Sen GM - Marketing MBA 42 24-Nov-05 19 Permanent Sales & Marketing 1,037,084 Tata Teleservices Limited / Head Business Intelligence and Analytics 152 Sudhir Chopra VP - Technical B.E / B.Tech 45 27-Jan-06 23 Permanent Technical Services 4,126,567 Alcatel Modi Network Systems Limited / Head-Projects 153 Sukanto Aich COO - AES BE & MBA 41 9-Jul-01 16 Permanent Operations & 4,533,983 Escosoft Technologies Limited / Corporate South Management Head Sales 154 Suman Kaul AGM - MAP A/cs MBA 39 1-Oct-07 14 Permanent Sales & Marketing 1,350,514 Verizon India Private Limited / Sales Manager 155 Sunil Maxwell CHRO - South & B.Sc 53 15-Jan-08 26 Permanent Human Resources 2,302,805 Teletech Limited / Head - HR Massey West 2 156 Sunil Raina Head - Marketing MBA 35 2-Sep-04 10 Permanent Sales & Marketing 450,140 Tata Teleservices Limited / Asst.Manager 157 Sunny Thomas Head - CSD PGSM & PR 40 1-Mar-05 15 Permanent Customer Service 2,117,987 Idea Cellular / Head Collections Delivery 158 Surender Kumar GM - Compliance & B.E / B.Tech 43 18-Sep-06 21 Permanent Technology 891,514 Reliance Communications Limited/ Singh Performance Mgmt Services Dy. General Manager-IT 159 Suresh Kumar S Head - Operations MBA 40 3-Jan-01 16 Permanent Sales & Marketing 4,502,866 Pennisular E Com / Dy. General Manager 160 T K Balakumar Sr. VP - CSD B.E / B.Tech 47 21-May-04 24 Permanent Customer Service 6,624,043 Daksh Eservices Private Limited / Delivery Director - Operations & Quality 161 Vaibhav Jain Asst. Manager - B.Com 30 6-Jul-02 10 Permanent Sales & Marketing 505,373 American Express India Pvt ILD/Traffic Analysis Limited / Team Member

1 Director Report 39-67.p65 66 7/21/2009, 9:23 PM 1 DirectorReport 39-67.p65 7 ogne G aktn . .eh3 15-Jan-09 37 B.Tech / B.E DGM-Marketing Yougender 174 7 aiiKrpG ltnmCnr B 71Jn0 5PraetCsoe evc ,4,7 Hutch/Dy.GeneralManager Idea CellularLimited/Sr.Manager 1,348,175 537,622 Customer Service Sales&Marketing BritishTelecomInfonet/ Permanent 391,358 Permanent Sales&Marketing 15 13 Permanent 6 1-Jun-05 24-May-05 37 41 PGDBM 29-Sep-06 VP-Marketing 30 MBA MBA Yatin Pahwa GM-PlatinumCentre 173 B.E/B.Tech Yamini Kurup Asst.Manager-Sales 172 Head-FWP WajidShaikh 171 Vivek Sharma 170 6 ie hne P-MreigPDM4 -u-41 emnn ae aktn ,0,5 Escotel Mobile Communications 3,006,252 Sales&Marketing Reliance InfocomLimited/Head DLFUniversalLimited/ 2,069,188 4,100,366 Permanent LegalServices Permanent 18 Permanent Projects BlowPlastLimited/ 27 1,394,807 Sales&Marketing Permanent 16 8-Jun-04 Permanent 42 31 27-Sep-04 PGDBM 51 Thomson/U21Global/ 16 5-Apr-05 6,890,605 Sales&Marketing 42 PGDBM Sr.Manager- 16-Aug-85 54 Permanent VivekSethi 23-Sep-03 MBA 169 B.Tech&PGDM VP-Marketing 36 Vivek Chandel - Director Corporate 14 MBA 168 ChiefProcess VireshDayal 167 VinitTaneja Head-Legal MBA 166 5-Jun-06 VineetKumar 50 Marketing/ - DGM 165 Vinay Sharma GM-SCM 164 BE & MBA Vijaya Kumar 163 COO-Enterprise Vijay Srinivasan 162 Notes: Previousemployment/ Gross Nature of Nature Total of Date Age (s) Qualification Designation Name No. Sl. Kumar Reddy Mannur .Thedesignation“Director”whereverprefixeddescribetheareaofresponsibilityoccurringinabovestatementandisnot 5. Noneoftheemployeesmentionedaboveholds2%ormoresharecapitalCompany 4. NoneoftheemployeesmentionedaboveisarelativeanydirectorCompanyexceptSunilBhartiMittal,ChairmanandM 3. TheemployeewouldqualifyforinclusioninCategory(A)or(B)onthefollowingbasis: 2. GrossRemunerationcomprises ofsalary,taxableallowancesandPerquisitiesCompany’scontributiontoProvidentFund 1. .TheemployeesaregovernedbythegeneraltermsandconditionsofemploymentpoliciesCompany 6. of RakeshBhartiMittalandRajanMittal,directorsontheBoardCompany For (B)iftheaggregateremunerationdrawnbyhim/herduringpartofyearwasnotlessthanRs.200,000p.m. For (A)iftheaggregateremunerationdrawnbyhim/herduringyearwasnotlessthanRs.2,400,000p.a. Sunil BhartiMittal,ManojKohliandAkhilGupta Marketing Projects Officer Brand &Comm West Services Corporate 67 GM 54 PGDMM 76Ot0 3Permanent 13 6-Oct-03 37 71-c-51 Permanent 13 17-Oct-05 37 8My0 3PraetSpl hi ,2,0 TCS/Asst.GeneralManager 1,726,003 Supply Chain Permanent 23 28-May-07 of employment whether of the of designation remuneration whether ofduties employment, experience of employment commencement 7PraetSls&Mreig9735AvayaGlobalconnectLimited/ 917,355 Sales&Marketing Permanent 17 otata employee or otherwise contractual 7/21/2009, 9:23 PM Sales & Marketing 2,204,939 Cellnext Solutions / Solutions Cellnext 2,204,939 Sales &Marketing Delivery ae aktn 2,9 TataTeleservicesLimited/ 421,891 Sales &Marketing Management eieySr.VP&Director InstituteOfQualityLimited/ 3,526,470 Delivery Customer Service anaging Director,whoisabrother a Boardpositionexceptthatof Head -Presales Dy. GeneralManagerMarketing Sr. AccountManager Retail Manager Limited /GeneralManager Manager -Projects Legal, CollectionsandRegulatory Manager-Marketing Services VP- BusinessDevelopment 67 BHARTI AIRTEL ANNUAL REPORT 2008-09 13 Management Discussion & Analysis

Industry Structure and Developments Regulatory changes

Indian telecom industry • Regulation on Quality of Service (QoS) for the The Indian telecom sector has seen a phenomenal telecom sector growth and currently has close to 430 mn telecom On March 20, 2009, Telecom Regulatory Authority customers. The market surpassed the USA to become of India (TRAI) released its regulations on QoS the second largest market in the world after China. standards for both wireline and wireless services. Notwithstanding this, the telecom penetration is only For wireline services, TRAI has specified that billing 37% with a wireless penetration of 33.7% and complaints should be resolved within a maximum broadband penetration of 0.54%, thereby offering a of 4 weeks. A parameter, Answer to Seizure Ratio, good growth potential. has been prescribed as an alternative to the Call The target of the Government is to reach 500 mn Completion Rate (CCR) wherever the CCR cannot telecom customers of which 20 mn broadband be measured and reported. customers by 2010. India presents robust growth opportunities driven by economic growth, increasing For cellular services, the benchmark for call drop urbanization, rising income levels and a large youth rates has been revised from the existing less than population. The majority of new customers will be from 3% to less than or equal to 2%. The condition on the hinterland and remote areas with inadequate basic accumulated downtime for community isolation has infrastructure and no previous connectivity, demanding been replaced with a new parameter on network low tariffs for voice calls and value added services like availability, wherein network availability will be information about market and commodity prices, assessed through two separate parameters – Base weather update, health update etc. The urban consumer Transceiver Stations’ (BTSs) accumulated downtime demands high speed internet connectivity and audio- and worst-affected BTSs due to downtime. video streaming, navigation and location maps, music downloads, gaming, m-commerce, IPTV and mobile TV. • Interconnection Regulation for Broadcasting Sector Tariffs for local and long distance calls are at the lowest On March 19, 2009, TRAI released the new levels in the world and still falling. interconnection regulation for the broadcasting Innovations like shared infrastructure, new low cost sector wherein TRAI has not prescribed any limit / technology and energy saving devices are critical to regulation on carriage / placement fee, which rural connectivity. On the other hand, competition will distributors of channels charge from broadcasters intensify with entry of new players and interest from to carry their channels on its platform. global telecom operators, many of whom wish to re- enter India after an earlier departure and participate in Moreover, for the DTH sector, a distinction / the success of Indian telecom. definition has been prescribed for commercial and ordinary customers to enable DTH operators to Bharti Airtel, with over 96 mn customers as on March provide their services to commercial customers as 31, 2009, is the largest integrated telecom operator in well. India with investments of Rs. 23,489 mn, revenues of Rs. 373,521 mn and Rs. 78,590 mn in net profits. It is • QoS Regulations for DTH operators among the top five companies in terms of market On March 16, 2009, TRAI released its QoS capitalization in India. standards for DTH operators. As per this regulation, Recent developments in regulation DTH operators have been barred from amending the Whilst much of the success is attributable to the composition of their subscription package during the entrepreneurial spirit of the telecom companies, various first 6 months, if such channels continue to be pro-active and positive policy measures taken by the available on their platform. In case of withdrawal of regulatory authorities have also provided an impetus any channel within the first 6 months, the DTH for growth. The relative importance of the regulatory operator has to proportionately reduce the changes should be viewed in light of big challenges subscription charges and / or will have to offer any and opportunities that the industry is facing today (as other channel of the same genre and language. detailed in later sections of this report). Overall, the Apart from the above, the operator will not be direction and pace of regulatory changes is positive for allowed to charge any fee towards visiting or repair the industry and augurs well for the Company. The following list captures the key regulatory changes that and maintenance charges of DTH Consumer were implemented by the Department of Premises Equipment (CPE) during the period of Telecommunication (DoT) and Telecom Regulatory warranty for such DTH CPE acquired on outright Authority of India (TRAI) in the year 2008-09. purchase basis.

2 MDA & CGR 68-91.p65 68 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 Regulatory work-in-progress • • • • • of liquidateddamages. be consideredforrolloutobligationsimposition excluded. Moreover,in-buildingcoveragewillnot the averagedelayinSACFAclearanceshallbe As perDoT,whilecomputingtheperiodofoneyear, date ofthelicenceagreement. of startupspectrum,asagainstfromtheeffective Government. routed throughthebudgetary processoftheUnion directly managedbytheorganization andisnot amended sothatthemoney accruing tothefundis further statedthattheUSOfundActshouldbe administrative andfinancialauthority.TRAIhas administrator shouldbeeffectivelyempoweredwith rural connectivity.AccordingtoTRAI,theUSOfund efficient utilizationofthefundscollectedtoenhance of USOfundfromthepurviewDoTsoastoensure On March19,2009,TRAIrecommendedseparation telephony Universal ServiceObligation(USO)andRural an AccessProvider. services toitscustomerseitherdirectlyorthrough licensee hasalsobeenallowedtoprovidebilling line withAccessProviders,NLDOsandILDOs.The and inthisregardcanhaveagreementforleased with orwithoutvalueadditiontoendcustomers the licenseecansellbandwidthonretailbasis denomination. AfterobtainingtheIPLCfromILDOs, India andthecountryofdestinationforanycapacity been permittedtoprovideend-to-endIPLCbetween license regimeforIPLCwhereinresaleofhas On September24,2008,DoTintroducedanew Resale ofInternationalPrivateLeasedCircuit(IPLC) take contentfrombroadcasters. Earlier, IPTVserviceproviderswerenotallowedto to providetheircontentIPTVserviceproviders. linking oftelevisionchannelstoenablebroadcasters & Broadcastingmodifiedtheguidelinesfordown- On September8,2008,theMinistryofInformation Internet ProtocolTelevision(IPTV)Services and 3 and 3 The serviceprovidersnowneedtofulfilltheir1 obligations ofAccessServiceProviders. Telecommunications (DoT)modifiedtherollout On February10,2009,Departmentof Roll outobligations min. has beenreducedfromRs.0.20/min.toRs.0.15/ Charge from Re.0.30/min.toRe.0.40/min.(iii)Transit on incominginternationalcallshasbeenincreased reduced fromRe.0.30/min.toRe.0.20/min.(ii)TC wherein (i)TerminationCharge(TC)hasbeen On March9,2009,TRAIissuedarevisedIUCregime Interconnection UsageCharge(IUC)regime rd rd yearrespectivelyfromthedateofallocation phaseofrolloutobligationswithinthe1 69 st st • • • by theDoT. The aboverecommendationisyettobeendorsed DoT. expansion onlyandbalancetobetransferredthe a specialreserveandutilizedfortelecomnetwork the profitwillhavetoberetainedinbusinessas as well.However,onsuchtransactions,50%of allowed toselltheirequitywithinthelock-inperiod and DoT’spriorapproval,suchpromotersmaybe As perTRAI,afterfulfillmentofrolloutobligations of aUnifiedAccessServiceLicense. consideration fordeterminingtheeligibilitygrant promoter(s), whosenet-worthhasbeentakeninto period of3yearstheequitysharecapital On March12,2009,TRAIrecommendedalock-in Lock-in-period forPromoter’sequity po1Mz8 7 6 5 4 3 Upto 15MHz Upto 12.5MHz Upto 10MHz Upto 8MHz Upto 6.2MHz(GSM)/5MHz(CDMA) Upto 4.4MHz(GSM)/2.5MHz(CDMA) Spectrum Annual Proposed Spectrum inMHz2G charges fordifferentiallevelsofspectrumi.e. DoT’s proposaltoincreasetheannualspectrum Annual SpectrumCharges:TRAIalsoendorsed practical difficulties. to preventaccountingandarbitrageother account thehugedifficultiesinverificationandaudit segregation of2G&3Grevenueaftertakinginto the proposalofDoTtoruleout Segregation of2G&3Grevenue:TRAIendorsed charging. on DoT’svariousproposalsrelatedtospectrum On December10,2008,TRAIgaveitsconcurrence Spectrum Charges the model. share intheprovisioningofVASserviceswillremain content providers/aggregatorsforrevenue between telecomaccessserviceprovidersand As perTRAI,mutualcommercialagreements registration forVAS. recommend anyseparatecategoryoflicenseor recommendations relatedtoVAS.TRAIdidnot On February13,2009,TRAIreleasedits Value AddedServices(VAS) by theDoT. The aboverecommendationisyettobeendorsed towers tothenearblockheadquartersetc. scheme foropticalfibrefromUSOFsubsidized development blocksincludingvillages(ii)subsidy 2% USOlevyaftercovering75%ofthe to enhanceruraltelephonysuchas(i)reductionin TRAI alsomadeothersignificantrecommendations 7/21/2009, 9:23 PM Charges as%ofAGR 69 BHARTI AIRTEL ANNUAL REPORT 2008-09 These charges applicable to an operator with 2G ISPs both within telecom circle as well as across spectrum should be applicable to the 2G+3G the telecom circles, ISPs and NLDOs have been spectrum holder on their total AGR. permitted to connect with each other through public internet (the internet cloud) only. Spectrum Charges for stand-alone 3G operator : The annual spectrum charges will be 3% with moratorium As per TRAI, ISPs should not be subject to any QoS of 1 year from assignment of spectrum. norms and also may not be mandated to provide emergency number dialing at present. Apart from the above, TRAI also recommended an annual administrative charge of 2% of the highest This is yet to be endorsed by the DoT. bid amount during the validity of 3G spectrum. This • 3G and BWA Auction charge would be over and above the annual spectrum charges. This proposal is yet to be endorsed by DoT. During the year, DoT initiated the process of auction of 3G and BWA spectrum but the auction date was • Mobile Virtual Network Operator (MVNO) deferred with no definitive announcement on dates. On August 6, 2008 and by means of its subsequent It is expected that it will take place after the amendment dated March 12, 2009, TRAI formation of the new central government. recommended the entry of MVNOs in India. Meanwhile, a Group of Ministers has been constituted to decide on the issue of pricing of 3G The definition of MVNO as suggested is: “MVNO in spectrum and BWA licenses. a service area is an entity that does not have spectrum of its own for access services but is OPPORTUNITIES AND THREATS licensed to provide access services to its customers Opportunities through an agreement with any licensed access provider. The MVNO should not possess spectrum The rural landscape for access services in any manner including licensing The Indian telecommunication industry is now the 2nd of spectrum”. largest wireless market in the world after China and is As per TRAI, MVNO should be free to choose its poised to deliver solid growth forward. The focus on business model (Full or Intermediate or Thin). rural penetration and customer affordability will be Typically, a Thin MVNO would offer services in its instrumental in driving the next phase of growth in India. own brand without any infrastructure and a full The majority of the wireless net additions have started MVNO could set up its own HLR, VLR, IN switches, to come from the rural segment. MSC etc. but not the Radio Access Network (RAN). The telecom industry plays a pivotal role in transforming TRAI has also recommended that at present, one the lives of the rural households which account for 70% MVNO may be restricted to get parented to one of India’s population. An increasing number of rural telecom operator only in any service area. customers is contributing to the growth in telecom sector. The rural segment is witnessing a growth of This is yet to be endorsed by the DoT. 8-10% every month – giving a substantial boost to the • Carrier Selection and NLD Calling Cards telecom sector. On August 20, 2008 TRAI issued the direction that With rural teledensity still below 15%, the opportunities in today’s context Carrier Selection is not justifiable are immense and Airtel is leveraging its fast mover on ‘need & cost benefit basis’. advantage to reach the hinterlands. Currently, more than 60% of our new customers come from rural India. As an alternative to Carrier Selection, TRAI recommended that NLDOs and ILDOs should be New technologies and paradigms allowed to introduce their own calling cards. As per As growth in data traffic accelerates with the TRAI, on such long distance calling cards, local calls proliferation and adoption of web services the telecom and other intelligent network based and value added operators will evolve their infrastructure through services like tele-voting, toll free numbers, SMS/ upgrading their access transmission infrastructure from MMS and content services should not be allowed. the base stations to the core switching network. With This is yet to be endorsed by the DoT. increasing bandwidth and data demands, advanced technologies like HSPA, WiMAX and WiFi will be • Internet Telephony deployed. 3G and BWA auctions will be held in the 2nd On August 18, 2008 and by means of its subsequent half of the year. Convergence will be a vital phenomenon clarification dated February 3, 2009 TRAI to support all network and IT services, using IP as the recommended to allow ISPs to offer full fledged strategic technology. unrestricted internet telephony (i.e. calling from Infrastructure sharing may extend to active internet to PSTN/PLMN numbers and vice versa infrastructure, resulting in opportunity to reduce the within India). costs to deploy mobile network infrastructure. The In this regard, allocation of E.164 number resources Enterprise Segment will see increased emphasis on may be permitted to ISPs for providing Internet managed services and MPLS technology which provides Telephony. differentiated and assured Quality of Service (QoS). In order to facilitate termination of Internet Telephony Triple Play services (Voice, Data and Video) will gather calls on PSTN/PLMN and vice versa including among momentum with telecom operators getting into media

2 MDA & CGR 68-91.p65 70 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 for bothretailandbusiness customers. speed internet,TriplePlay,media-rich VAS,MPLS,VPN Networks (NGN)toofferadvanced serviceslikehigh- services forAirtel’smigration toNextGeneration India. Thejointventurewhenexecutedwillprovide Services in partnership forBroadbandandTelephone telephone services.ThisisthefirstManagedServices for managedservicesourbroadbandandfixedline/ We areconsideringajointventurewithAlcatelLucent applications. Music onDemand,EmailservicesandotherAirtelLive CRBT(caller ring backtone), experience intheareasof to provideeachofourcustomerswithaunique Comviva, Yahoo,GoogleandCellbrumamongothers with globallyrenownedorganizationssuchasOnMobile, enhance digitallifestyleforourcustomers.Wework application serversandinteractiveapplicationsto to provideasuiteofproducts,includingdevices, operations. WehaveastrategicpartnershipwithInfosys customer experiencethroughdedicatedcallcenter and HTMTareassociatedwithusforprovidingexcellent Daksh, Mphasis,Firstsource,Teleperformance,Aegis CISCO, WIPROandTellabsamongothers.Nortel,IBM distance networksequipmentpartnersincludeSiemens, integration platform.Telephoneservicesandlong key businessprocessesandestablishinganenterprise working closelywithustotransformourITsystems, the arttechnologyacrossournetworks.IBMhasbeen our aggressiveexpansionplansbydeployingstateof Siemens andHuaweiareequipmentpartnerssupporting for developmentofinnovativesolutions.Ericsson,Nokia equipment andtechnologypartnerswhoshareourdrive We havealsoestablishedstrongallianceswith made intheworldoutsideSingapore. SingTel inBhartiisoneoftheirlargestinvestments service toourcustomers.Theinvestmentmadeby telecommunications networkinIndiatoprovidequality enabled ustofurtherenhanceandexpandour We haveastrategicalliancewithSingTel,whichhas Strong strategicpartnerships customers. in SriLanka,andcreatevaluefortheLankan and wehopeexpecttoestablishastrongpresence business modelissuitablefortheSriLankancustomer in theIndianMarketanduniquevaluebasedlowcost in January2009isveryencouraging.Ourexperience Our entryintotheSriLankanmarketfortelecomservices in theIndiancontext. NGN (NextGenerationNetworks)relatedtechnologies feasibility andthemodelforadopting3Gother Bharti Airtelwillparticipateinthediscussionson technologies. integrated playerthroughofferingservicesacrossall to thissegment.Airtelwillstrengthenitspositionasan Government ofIndiawillallworktogethergiveaboost introduction ofCAS(conditionalaccesssystem)bythe coupled withgrowingdemandfordigitalcontentand and servicestandardsofexistingcableoperators, will evolvefurtherasthelowlevelsofreach,quality space throughDTHandIPTVplatforms.Themarket 71 have beenlaunchedonastate-of-the-art 3.5Gnetwork. services arenowoperationalin SriLanka.Theseservices the Company’slaunchon January12,2009,our approximately 81%ofthecountry’s population.Post census townsandvillages inIndia,thuscovering operations to5,060censustownsand414,906non- During thefinancialyear,Companyexpandedits distribution channel,covering1,191,323outlets. value addedservicesthroughitsextensivesalesand The Companyofferspost-paid,pre-paid,roamingand 24% ofthewirelessmarket,asonMarch31,2009. customers accountedforacustomermarketshareof customers. Thecompany’s93,923,248mobile business, bothintermsoftotalrevenuesand constitutes thelargestportionofCompany’s based onthenumberofcustomers.Thissegment the largestwirelessserviceproviderincountry, technology on900MHzand1800MHzbands,is The CompanyoffersmobileservicesusingGSM Mobile Services 2008. 50.38% comparedtothecustomerbaseonMarch31, customers. Ourtotalcustomerbaseincreasedby of 93,923,248mobileand2,726,239Telemedia had anaggregateof96,649,487customers,consisting previous year.AsonMarch31,2009theCompany representing acustomeradditionof51.52%overthe added 31,938,527mobilecustomersinFY2008-09, all segmentsinwhichitoperates.Inall,theCompany Bharti Airtelhashadanoverallrobustperformancein SEGMENT WISEPERFORMANCE emerge strongerandretainitsleadership. integrated portfolioofproductandserviceofferingswill expenditure inthecomingyear.BhartiAirtel,withits some tarifferosionandpressureonmarketing and nationallongdistanceoperators.Thismayleadto The marketalsosawtheentryofmanyinternational market willgrowto550mncustomers. The comingyearwillseecompetitionintensifyasthe operators migratingtoGSMfromCDMAtechnology. of manyexistingplayersintonewercirclesalongwith The wirelessmarketintheyear2008-09sawentry revenue Increased competitionmayreducemarketshareand/or economy. India growthstorycontinues,backedbyastrongrural in thesecondhalfofthisfiscalyear.However, affected bythisbutweexpectrevivalofsegment top-lines. Asaresult,theEnterprisebusinessmaybe multinational corporationsarestrugglingtogrowtheir confidence andprovideemploymentopportunities.Large packages tostimulategrowth,infuseconsumer Governments acrosstheglobeareofferingbailout cascading downtothesmallerandemergingeconomies. impacted thelargesteconomiesandeffectis There isaglobaleconomicslowdownthathasseverely Economic Meltdown Threats 7/21/2009, 9:23 PM 71 BHARTI AIRTEL ANNUAL REPORT 2008-09 The Company’s strong performance has helped to partner to India’s leading organizations, helping them consolidate its leadership in the market and has given to meet the challenges of growth. it the opportunity to take full advantage of the rapidly The Enterprise Services group has two sub-groups, viz. growing telecom market. Carriers and Corporate business units. The revenues from the mobile services for the financial Carriers – the Carrier business unit provides long year were Rs. 304,188 mn, a growth of 39% over the distance wholesale voice and data services to carrier revenues in the previous financial year. The mobile customers as well as to other business units of Airtel. services business contributed 81% to the consolidated revenues. The growth in revenues happened despite It also offers virtual calling card services in the overseas reductions in tariffs and intense competition. With markets. The business unit owns a state of the art mobile tariffs in India being among the lowest in the national and international long distance network world, the Company’s prime focus is on ensuring infrastructure enabling it to provide connectivity services customer satisfaction through network quality, superior both within India and connecting India to the world. customer service and continuous innovation in value- The national long distance infrastructure comprises of added services that would help expand its mobile 101,337 route kilometers of optical fibre, over 1,500 subscriber base and drive up volumes. The key financial MPLS and SDH POPs and over 1,491 POIs with the results of the mobile segment for the year ended March local exchanges, providing a pan-India reach. 31, 2009 are presented below: The international infrastructure includes ownership of Particulars FY 2007-08 FY 2008-09 Y-o-Y the i2i submarine cable system connecting Chennai to Growth Singapore, consortium ownership of the SMW4 Customers 61,984,721 93,923,248 52% submarine cable system and investment in capacities Gross Revenue Rs. 218,697 mn Rs. 304,188 mn 39% across a number of diverse submarine cable systems EBIT Rs. 59,269 mn Rs. 68,746 mn 16% across transatlantic and transpacific routes. In the recent Telemedia Services past we have announced investments in new cable systems such as Asia America Gateway (AAG), India The Company provides broadband (DSL) and telephone Middle East and Western Europe (IMEWE), Unity North, services (fixed line) in 15 circles spanning over 95 cities EIG (Europe India Gateway) and Eastern Africa with growing focus on new media and entertainment Submarine Cable System (EASSy). solutions such as DTH and IPTV. As on March 31, 2009, the Company had 2,726,239 customers (a growth of The key financial results of the Carriers division for the 19.3%), of which 39.3% (~10, 71,412) were year ended March 31, 2009 are presented below. subscribing to broadband / internet services. Particulars FY 2007-08 FY 2008-09 Y-o-Y The product offering in this segment includes supply Growth and installation of fixed-line telephones providing local, national and international long distance voice Gross Revenue Rs. 43,798 mn Rs. 68,235 mn 56% connectivity and broadband Internet access through EBIT Rs. 11,289 mn Rs. 25,709 mn 128% DSL. Corporates - This business unit delivers end-to-end We also remain strongly committed to our focus on telecom solutions to India’s large corporates. It serves Small and Medium Business Enterprises. We provide a as the single point of contact for all telecommunication range of customized Telecom / IT solutions and aim to needs for corporate customers in India by providing a achieve revenue leadership in this rapidly growing full suite of communication services across data, voice segment of ICT market. and managed services. The strategy of our Telemedia business is to focus on It specializes in providing customized solutions to cities with high revenue potential, except for DTH which address unique requirements of different industry is an all India offering. Airtel digital TV is available to verticals; BFSI, IT, ITeS, manufacturing and distribution, customers through 31,000 retail points in over 4,000 media, education, telecom, Government and PSUs and cities and towns across the country. retail among others. The revenues from the Telemedia services were Backed by the alliances with leading technology Rs. 33,426 mn, a growth of 17% over the revenues in companies worldwide and state of the art infrastructure, the previous financial year. The key financial results of it offers a complete range of telecom solutions. These Telemedia Services for the year ended March 31, 2009 solutions enable corporates to network their offices are presented below. within India and across the globe, provide them infrastructure to run business critical applications and Particulars FY 2007-08 FY 2008-09 Y-o-Y provide them means to connect with their customers, Growth vendors and employees. Customers 2,283,328 2,726,239 19% Gross Revenue Rs. 28,615 mn Rs. 33,426 mn 17% These services include; Internet, MPLS -VPN, domestic EBIT Rs. 6,109 mn Rs. 8,188 mn 34% and international private leased circuits, Satellite Enterprise Services services (VSAT), Audio and Video conferencing, Data Centre services, Managed network services, corporate Enterprise Services provides a broad portfolio of services Value Added Services, EPBX, Centrex, Contact centre to large Enterprise and Carrier customers. Enterprise solutions, Toll free services, Mobile Enterprise Services is regarded as the trusted communications Enablement solutions.

2 MDA & CGR 68-91.p65 72 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 key driversforsuccess. planning andourstrongpartner ecosystemwillbethe We believethatcustomervalue management,market services arebasedondeep customerunderstanding. We areaninnovativecompany andourproducts • • • • • • our leadership,basedon:- We believethatweareinastrongpositiontoenhance to haveanallIndiafootprintandoperationsinSriLanka. forefront. WearethefirstprivatemobileGSMoperator the economicrevivalandBhartiAirtelwillbeat We havenodoubtsthatthetelecomsectorwilllead of theeconomyinsecondhalfthisfiscalyear. The Indiagrowthstorycontinuesandweexpectrevival mn 50,913 Rs. OUTLOOK Rs.6,023mn FY EBIT Revenue Gross Particulars are: Services divisionfortheyearendedMarch31,2009 The keyfinancialresultsofthePassiveInfrastructure 95,154 towersincludingtheunderrightofuse. financial yearendedMarch09andhasaportfolioof Indus Towershasbuilt14,484towersduringthe January 2009. use hasbeenassignedtoInduswitheffectfrom1st the 35,066towersin12circlesforwhichrightof Bharti Infratelhas27,548towersin11circles,excluding Infratel, 12circlesonexclusivebasis). Indus operatesin16circles(4commonwith between BhartiInfratel,VodafoneandIdeaCellular). holds 42%shareinIndusTowers(aJointVenture passive infrastructurein11circlesofIndia.Infratelalso in India.BhartiInfrateldeploys,ownsandmanages Rs. on anon-discriminatorybasistoalltelecomoperators 18% Bharti Infratelprovidespassiveinfrastructureservices Rs.16,434mn Passive InfrastructureServices Rs.13,885mn FY EBIT Revenue Gross Particulars are presentedbelow. Corporates divisionfortheyearendedMarch31,2009 The keyfinancialresultsoftheEnterpriseServices– business partnersandourintegratedplayerstatus the abilitytoleverageonstrengthsofour the expansionofournetworkstoruralmarkets services, m-commerce,m-entertainment,media) our focusonnewservicesandbusinesses(managed financial healthandpositivefreecashflow our abilitytomaximizereturnsoninvestment;strong customer experience our focusonbuildingastrongbrand,andenhancing our richhumanresourcetalentpool s ,4 nRs.3,204mn Rs. 1,243mn 73 ,4 nR. 598m 13% Rs.5,928mn 5,245 mn 070 FY2008-09 2007-08 FY2008-09 2007-08 Growth Growth 158% 745% Y-o-Y Y-o-Y financial andoperational. performance withreference tobusinessplans;both whereby theManagement regularly reviewsactual an extensivemonitoring and reviewmechanism, company policies.TheCompany hasalsoputinplace compliance withstatutorylaws,regulationsand statements andmanagementreportsensure facilitate accurateandtimelycompilationoffinancial controls toallowoptimaluseandprotectionofassets, The Companydeploysarobustsystemofinternal INTERNAL CONTROLSYSTEMS of leadershipskillsandonbuildingemployeemotivation. the riskweplaceconsiderableemphasisondevelopment schemes includingESOPs.Further,inordertomitigate As aretentionstrategy,thecompanyhasissuedmany hunting groundfortalent. other companiesoftenlooktoBhartiAirtelLtdasa Given thetrackrecordandsuccessofouremployees, We believethattalentedmanpowerisakeystrength. increased requirementfortalentedmanagerialpersonnel. The growthoftheIndianeconomyhasledtoan Skilled ManpowerandTalent do soourselves. had inthedeploymentprocessesbeforechoosingto assessing theexperienceourinternationalpartnershave We haveprudentlydeployednewtechnologiesafter affected. customers, ourabilitytoremaincompetitivecouldbe to adopt,failbecost-effectiveandacceptedby technologies wehaveadopted,oronwhichintend introduce sophisticatednewtechnologies.Ifthe In ordertoremaincompetitive,weconsistently competition andourcapitalcosts Changes inavailabletechnologycouldincrease most circumstances. will enableustocontinuewithnormaloperationsunder continuity plansanddisasterrecovery,initiatives,which We havebeeninvestingsignificantlyinbusiness in ouroperations. insurance, maycausedisruption,howevertemporary, failures andnaturaldisastersevenwhencoveredby fire, specialperils,andterroristattacks.Technical network, whichprovidescoverfordamagecausedby replacement valueofourexistingtelecommunications We maintaininsuranceforourassets,equaltothe our telecommunicationnetworks. Technical failuresandnaturaldisasterscoulddamage in mind. for alloperators,keepingthecustomers’bestinterest government willcontinuetoensurealevelplayingfield regulatory environment.Weareconfidentthatthe We, however,donotperceiveadversechangesinthe The telecombusinessissubjecttoextensiveregulation. our business. Government, whichcouldhaveanadverseeffecton Our businessissubjecttoextensiveregulationbythe RISKS ANDCONCERNS 7/21/2009, 9:23 PM 73 BHARTI AIRTEL ANNUAL REPORT 2008-09 The Corporate Assurance Group is responsible for strengthen its competitive advantage. We have focused performing regular Internal Assurance reviews to ensure on intensive training and development for employees adequacy of the internal control systems and adherence at all levels aimed at grooming our people to take larger to management policies and statutory requirements. responsibilities and newer challenges. Career The Corporate Assurance Group deploys an Annual progression and succession planning has been the key Internal Assurance plan based on assessment of major to build a robust leadership pipeline. While a large risks in each of the businesses. Risk Assessment helps number of key leadership positions were filled in from in identifying and focusing on all high-risk areas. The our large internal leadership pipeline, we have also internal assurance review covers all the business-critical focused on acquiring new competencies required for processes, such as Sales and Marketing, Revenue new business opportunities. Airtel also brought in high Assurance, Billing & Collection, Technology Services, quality people from the best companies across the globe. Network Operations, Procurement and Financial Airtel has constantly re-invented its business model and Accounting. organization design to create challenging jobs and offer The Corporate Assurance Group reports directly to the an enriched experience for our people. The company Audit Committee of the Board and to the Chairman and has also encouraged employees to participate in our Managing Director of the Company and administratively CSR initiative of educating under-privileged children in rural areas. It is heartening to note that the various HR to the CEO & Joint Managing Director. The Board Audit initiatives have helped in reducing the attrition to 18% Committee approves the annual audit plan, reviews from the earlier 28%. Airtel is also the proud recipient observations of both internal and external audits, risk of the prestigious ‘Gallup Great Place to Work’ award assessment and adequacy of internal controls. second time in row. DISCUSSION ON FINANCIAL PERFORMANCE At the end of March 31, 2009, Bharti Airtel had a total Particulars FY 2007-08 FY 2008-09 Commentary of 24,538 employees; 10,357 were on the rolls of Bharti Customers 64,268,049 96,649,487 Growth of Airtel Limited, 14,181 were on the rolls of Bharti Airtel 50% Y-o-Y Services Limited. Gross Revenue Rs 270,122 mn Rs 373,521 mn Growth of 38% Y-o-Y COMPETITION EBITDA Rs 114,018 mn Rs 152,858 mn Growth of 34% Y-o-Y Competition is not new to the Indian telecom industry PAT Rs 63,954 mn Rs 78,590 mn Growth of and the Industry has witnessed the launch of new circles 23% Y-o-Y by existing players and migration to GSM technology Gross Assets Rs 423,224 mn Rs 586,616 mn Increase by Rs 163,392 mn by CDMA players. Many mobile players are also entering Capital Rs 218,043 mn Rs 166,945 mn Decline of the Enterprise business by launching their NLD/ILD Expenditure 25% Y-o-Y operations. Capital 63.82% 63.67% Productivity Bharti Airtel has consistently strengthened its leadership MATERIAL DEVELOPMENTS IN HUMAN RESOURCES position among the private operators, backed by its strong execution capabilities, customer centric products The year 2008-09 witnessed unprecedented changes and services and a strong management team. We will in the global business environment. However, the India continue the focus on our customers with Value Added telecom sector in India continued to grow rapidly, adding Services and invest in further enhancing our brand new customers and directly contributing to the country’s strengths. We are confident that with the solid economic growth. foundations built over the past 14 years, we are well placed to take full advantage of the market opportunities Despite increased competition and tough economic that this buoyant market presents and continue to hold conditions, it has been a year of expanding market our leadership position. leadership for Airtel. While our three businesses continue to grow from strength to strength, the launch of mobile KEY STRATEGIES services in Sri Lanka operations, DTH and IPTV services In the year gone by, Bharti Airtel has focused on making has now made Airtel a complete integrated player with telecom services affordable through a dedicated effort a presence across the three screens – mobile phones, of rationalizing and simplifying tariffs. The Company computer and TV screens and with geographical will continue to pursue this strategy of affordability, presence beyond India. availability and simplicity. The customer has been at Our performance in 2008-09 has demonstrated that the centre of our strategy and going forward our full our strategies of customer and employee centricity, focus will be, and remain on customer service. The higher investments for building infrastructure and leaner Company believes that infrastructure sharing will provide business model have helped us not only to weather the a boost to managing efficient operations, resulting in storm but also to emerge stronger in the market place. significant cost savings. We will explore the extent of active infrastructure sharing based on guidelines issued With the 2010 vision of ‘being the most admired brand by TRAI. We recognize the potential offered by the in India targeted by top talent’ as a constant theme, rural Indian market. Significant expansion, both of Airtel has a long-term human resources strategy in place network and distribution, is being planned. In the coming to attract, retain and get the best talent; to build the year, the Company expects more than half of its new right capabilities in current and new businesses and business to come from rural customers.

2 MDA & CGR 68-91.p65 74 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 investments intheareaofbroadbandtoenhance and IPTVservices.TheCompanywillincrease mobile businesswithDirect-to-home(DTH)services The comingyearwillseeastrongeremphasisonnon- unique businessmodel. in SriLankawhereithassuccessfullyreplicatedits expanded abroadthroughthelaunchofitsoperations In additiontoruralexpansion,BhartiAirtelhasalso 75 strong financialhealth. that thiswillresultinproductivitygainsandongoing appropriate changesinourbusinessmodel.Weenvisage delivering oneconomiesofscaleandbymaking Our focusistoachievehighercostefficiencyby customized solutionsintheB2Bspace. Company willfocusonnon-voicebusinessbydeveloping penetration andusageofbroadbandservices.The 7/21/2009, 9:23 PM 75 BHARTI AIRTEL ANNUAL REPORT 2008-09 14 Report on corporate governance

GOVERNANCE PHILOSOPHY • A formal induction schedule for new members that enables them to meet individually with the top Corporate governance has been the subject of much management team debate and discussion and as the Indian economy continues to grow in the midst of a global recession, it • Reviewing regularly and establishing effective assumes increasing importance in establishing credibility meeting practices that encourage active and trust for long term sustainability of a business participation and contribution from all members enterprise. Globally, there is ample evidence to demonstrate that strong governance brings tangible • Independence of directors in reviewing and financial benefits as well as intangible rewards to approving corporate strategy, major business plans companies. There is substantial variation in governance and activities as well as senior management models from country to country and even within appointments companies in the same country. Traditional views of • Well defined corporate structure that establishes governance as a regulatory and compliance requirement checks and balances and delegates decision making is giving way to voluntary adoption of governance to appropriate levels in the organization. tailored to the specific needs of a company or country. Clause 49 has set the minimum compliance rules for a Corporate governance rating listed company and other matters like sending the CRISIL has assigned Governance and Value Creation agenda containing timely and adequate information for (GVC) rating viz. “CRISIL GVC Level 1” on the corporate informed decision making, running the agenda and board meeting process efficiently and writing and distributing governance and value creation practices of the minutes regularly and promptly only set the baseline Company. This indicates our capability and clear for governance standards. Our Company’s endeavor is objective to create value for all our stakeholders, while to achieve higher standards and provide oversight and preserving the high standards of ethics and governance. guidance to management in strategy implementation We acknowledge that corporate governance is an and risk management and fulfillment of company’s upward moving target, and we aim to establish and objectives and goals. benchmark ourselves with the best of companies in India and overseas to ensure that we maintain the Independent directors are appointed not merely to fulfill highest rating for our practices. the listing requirement but for their diverse skills and experience, international perspective as well as the BOARD OF DIRECTORS external objectivity that each of them bring to effectively Composition of the Board perform their role to provide strategic direction and guidance and provide constructive support to In compliance with the Listing Agreements, FDI management by asking the right questions and guidelines, other statutory provisions and the terms of generating quality debates and discussions on major the shareholders’ agreement, the Board has sixteen decisions. members with an executive Chairman & Managing Director and CEO & Joint Managing Director, besides Corporate Governance Practices in Bharti Airtel Limited fourteen non-executive directors of whom eight are are based on the following: independent directors. • Compliance with regulatory and fiduciary requirements in letter and spirit A detailed profile of each of our directors is available on the website of the Company at www.airtel.in in the • Ensuring complete and timely disclosure of relevant Investor Relations section and also included in the annual financial and operational information to enable the report. Board play an effective role in guiding strategy The members of our Board are from diverse backgrounds • Adoption of a policy on tenure of directors, rotation with skills and experience in critical areas like of auditors and a code of conduct for directors and technology, finance, entrepreneurship and general senior management management. Many of them have worked extensively • Creation of various committees for audit, senior in senior management positions in global corporations management compensation, HR policy and and a few are industrialists of repute with knowledge management compensation, employee stock option of the Indian business environment. The Board reviews plans and investor grievance its strength and composition from time to time to ensure that it remains aligned with the requirements of the • An informal meeting of independent directors that business. meets prior to the commencement of every board meeting without the presence of any non Our Board is responsible for the appointment of new independent/executive director to raise and discuss directors from time to time. The appointments of such important issues that they would like to be directors are also approved by the shareholders at the addressed at the Board meeting annual general meeting.

2 MDA & CGR 68-91.p65 76 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 Manoj Kohli Sunil BhartiMittal Nikesh Arora Mauro Sentinelli Arun BharatRam Ajay Lal Pulak ChandanPrasad N Kumar Kurt Hellstrom Francis Heng Quah KungYang Paul O’Sullivan Chua SockKoong Rakesh BhartiMittal Rajan BhartiMittal Craig Ehrlich Name ofdirector Donald Cameron Bashir Currimjee Akhil Gupta 12. Thefollowingnon-executive directorsholdequitysharesintheCompanyasfollows:Akhil Gupta-1091692includingshares 1 Except SunilBhartiMittal,RakeshMittalandRajan Mittal,whoarebrothersandpromoterdirectors,noneoft 11. CraigEhrlichwasappointed asadditionaldirectorw.e.fApril29,2009 10. NikeshArorawasappointedasadditionaldirectorofthe Companyw.e.fOctober30,2008. 9. KurtHellstromhasresignedfromtheBoardw.e.fApril29,2009. 8. DonaldCameronresignedfromtheBoardeffectiveApril25,2008 7. FrancisHengresignedfromtheBoardw.e.f.August01,2008. 6. QuahKungYangwasappointedasanadditionaldirectoroftheCompanyeffective August01,2008.Priortohisappointment 5. AkhilGuptarelinquishedthepositionofJointManagingDirector effectiveAugust1,2008 4. ManojKohliwasappointedasJointManagingDirectoroftheCompanyeffectiveAugust01,2008. 3. ThecommitteesconsideredforthepurposearethoseprescribedunderClause49(I)(C)(ii)ofListingAgreement(s)viz.aud 2. Thedirectorshipsheldbythedirectors,asmentionedabovedonotincludeinforeigncompanies,priva 1. table: The requisiteinformationaspertherequirementsofClause49ListingAgreementisprovidedinfollowing half theBoardcomprisesofindependentdirectorssince In compliancewithClause49oftheListingAgreement, held jointlywithhisrelative,Mr. AjayLal-10,000sharesandBashirCurrimjee-700through arelative. directors arerelativesofanyother director meeting heldonJuly23,2008. as anadditionaldirector,QuahKungYangwasalsoappointed analternatedirectortoFrancisHengforattendingoneboard details provideddonotincludechairmanshipofcommitteesas it hasbeenprovidedseparately. which arepubliclimitedcompaniesintermsofsection3(1)(iv)(c)theCompaniesAct,1956.Thecommitteemembership committee andshareholders/investorsgrievanceofIndianpubliclimitedcompaniesprivate membership andchairmanship. limited companiesintermsofsec3(1)(iv)(c)theCompaniesActhavebeenincludedno.directorship,committee Private limitedcompanieswhicharepublic limited companiesandunderSection-25oftheCompaniesAct,1956. 4 3 10 9 6 8 7 5 77 0441Execu 00042491 02612082 02433389 02162922 00694766 00030388 00003557 00007848 00530736 00152992 01473283 02274965 00051156 00047851 00042494 00028016 Execu 00028728 00162071 Number Identification ietrCategory Director 00137892 Promoter needn ietr1--1N.A. No No 1 No 3 No 4 Yes - 3 No - 4 4 4 - 2 2 N.A. N.A. - 1 1 N.A. - N.A. 1 - - 1 No 1 - No 2 Independent director 11 5 N.A. 4 2 Independent director - 4 Yes 2 Independent director 2 - 7 Independent director - 1 Independent director Yes 3 Yes - Independent director N.A. - N. Independent director 4 - 4 Independent director 5 - N.A. Independent director 2 4 2 4 Non-executive director 1 2 Non-executive director Non-executive director 2 3 7 Non-executive director promoter 10 Non-executive director– 12 promoter Non-executive director– Non-executive director needn ietr1--3No 3 - - 1 Independent director iedrco Yes 4 - 2 9 tive director– iedrco Yes 2 1 2 4 tive director Board. Sunil BhartiMittalistheExecutiveChairmanof ietr himn Member- Chairman- Director- Number ofdirectorships hp hp ships ships ships committee and chairmanships 7/21/2009, 9:23 PM 2 ebrhp board memberships .NA No 2 N.A. A. omte teddAGM attended Committee 1 n No. of and ..NA N.A. N.A. N.A. meeting attended Whether last he te it 77 BHARTI AIRTEL ANNUAL REPORT 2008-09 Governance Structure (c) Operations management – by the Management Boards of the three SBUs assisted by their Building a culture of integrity in today’s complex business respective Hub or Circle Executive committees (ECs) environment demands high governance standards in for day-to-day management and decision making, every area of operation. Bharti Airtel’s commitment to focused on enhancing the efficiency and full compliance is backed by an independent and fully effectiveness of the respective businesses; and informed board and comprehensive processes and policies that strive to enable transparency in our functioning. (d) Technology management – by the Airtel Technology The organisation structure is headed by the Group Council, concentrating on assessing emerging Chairman and Managing Director, supported by the CEO technological trends and achieving consensus on & Joint Managing Director. Recently, a Deputy CEO has future technology initiatives and action plans. been appointed with direct responsibility for operations Our governance structure helps in clearly determining of the Mobility and Telemedia business units. There is a the responsibilities and entrusted powers of each of clear demarcation of duties and responsibilities amongst the business entities, thus enabling them to perform the three positions: those responsibilities in the most effective manner. It • The Group Chairman and Managing Director is also allows us to maintain our focus on the organizational responsible for providing strategic direction, DNA and current and future business strategy, besides leadership and governance, leading transformational enabling effective delegation of authority and initiatives and international strategic alliances empowerment at all levels. besides effective management of the Board; Independent directors • The CEO & Joint Managing Director is responsible Our Board has adopted a comprehensive policy on for the enterprise business, performance of independent directors that sets out the criteria of functions like marketing, customer service, HR, IT, independence, age limits, recommended tenure, Finance, Network, Legal and Supply Chain membership of committees, remuneration, and other Management amongst others. He is also responsible related terms. The policy emphasises the importance for employee engagement, customer satisfaction, of independence and states that an independent director ensuring success of outsourcing initiatives and shall not have any kind of relationship with the Company improvements in the internal control metrics; that could influence such directors’ position as independent director. As per the policy: • The Deputy CEO heads the operational team and is responsible for the performance of the Mobility and a) The independent director must meet the baseline the Telemedia business including the recently definition and criteria on “independence” as set out launched Direct To Home and new projects and in Clause 49 of the Listing Agreement and other initiatives. regulations, as amended from time to time; Our Company’s business is structured into three b) The independent director must not be disqualified Strategic Business Units (SBUs) i.e. Mobile Services, from being appointed as director in terms of Section Telemedia Services (formerly known as Broadband & 274 and other applicable provisions of the Telephone Services), and Enterprise Services. Each of Companies Act, 1956; the business units is headed by a business President. c) The minimum age is 25 years and the maximum is The corporate governance structure of our Company is 70 years; multi-tiered, comprising governing boards at various d) The independent directors will be appointed on at levels, each of which is interlinked in the following least one committee but not more than two manner: committees of the Board; (a) Strategic supervision and direction – by the Board e) It is recommended as a general principle that the of directors, which exercises independent judgment independent director should not be a director on in overseeing management performance on behalf Board of more than six public listed companies; of the shareowners and other stakeholders and hence plays a vital role in the oversight and f) Subject to re-appointment at annual general management of the Company; meetings, tenure for independent directors is three terms of three years each. For incumbents who are (b) Control and implementation – by the Airtel in their third term, the term will be until completion Management Board (AMB). The CEO & Joint in the normal course or three years from 1 January Managing Director, the Presidents of the three SBUs 2008, whichever is later; and the Functional Directors are members of the Airtel Management Board. The AMB meets monthly g) The tenure of independent directors on Board and takes decisions relating to the OneAirtel committees will be as follows : business strategy and looks at achieving operational • Tenure for the chairmanship of the audit synergies across business units. The team owns committee is two terms of three years each; and drives company-wide processes, systems and policies. The AMB also functions as a role model • Tenure for the chairmanship of the HR committee is two terms of two years each; for leadership development and as a catalyst for imbibing customer centricity and meritocracy in the • The tenure of lead independent director shall culture of the Company. be two terms of two years each.

2 MDA & CGR 68-91.p65 78 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 Board specificallyincludes: employees. Theinformationregularlysuppliedtothe information withintheCompany,andtoallour The Boardhascompleteaccesstoalltherelevant Information availabletotheBoard held onthesamedatesasboardmeetings. HR andESOPcompensationcommitteemeetingsare with theannouncementofquarterlyresults.Theaudit, following eachquarterinthemannerthatitcoincides for thewholeyear.Boardmeetingsareheldinmonth well asmajoritemsoftheagendaisfixedinadvance The calendarfortheBoardandcommitteemeetingsas Delhi. than 4months.MeetingsaregenerallyheldinNew The timegapbetweentwomeetingswasnotmore times, onthefollowingdates: During thefinancialyear2008-09,Boardmetfour Number ofBoardmeetings • • • • • • • • • • of theleadindependentdirectoristo: designated astheleadindependentdirector.Therole board relatedmatters.BashirCurrimjeehasbeen an independentopinionontheagendaitemsandother representatives ofmanagement)todiscussandform (without thepresenceofanyexecutivedirectorsor commencement ofeveryboardmeeting,ontheirown, All independentdirectorsmeetseparatelypriortothe director Meeting ofindependentdirectorsandlead for information. criteria. AllsuchdeclarationsareplacedbeforetheBoard ensures thatthedirectorsmeetaboveeligibility of theListingAgreement.Inaddition,Companyalso the testofindependenceaslaiddownunderClause49 independent directorstotheeffectthattheyqualify annually andatthetimeofappointment,from We haveadoptedapracticeoftakingself-declaration companies; minutes ofthemeeting Boardofsubsidiary committees, resolutionspassed bycirculations,and Minutes ofmeetingsthe Boardandboard divisions orbusinesssegments; Quarterly resultsfortheCompany anditsoperating therein; Annual operatingplans,capitalbudgetsandupdates January 21and22,2009 October 30and31,2008 July 23and24,2008 April 24and25,2008 requested bytheBoardfromtimetotime. Undertake suchotherassignmentsasmaybe Company; including agendaandothermattersrelatingtothe directors asagrouptotheBoardonvariousmatters Provide objectivefeedbackoftheindependent independent directors; Preside overalldeliberationsessionsofthe 79 the membersare includedintheagendaof the meeting. deliberation atthemeeting(s). Theitemssuggestedby proposals fromindependent directorsfordiscussion/ Before everyboardmeeting, asaprocess,weinvite the respectivecommitteemeeting. committee briefstheBoard about theproceedingsof update totheBoard,Chairmanofrespective prior totheBoardmeeting.Toensureanimmediate meetings areheldonthesamedayofBoardmeeting, Our audit,HRandESOPcompensationcommittee reports ontheitemsbeingdiscussedatmeeting. members areinvitedtotheBoardmeetingspresent Director –Financeandotherseniormanagement at thetableduringcourseofmeeting.Corporate the agendapapersofBoardmeetingand/orisplaced The aboveinformationisgenerallyprovidedaspartof • • • • • • • • • • • • • • • • • • rate movement,ifmaterial; management tolimittherisksofadverseexchange exchange exposuresandthestepstakenby Quarterly treasuryreportsincludingdetailsofforeign business; assets, whichisnotinthenormalcourseof Sale ofmaterialnature,investments,subsidiaries, Human resourceupdatesandstrategies; goodwill, brandequityorintellectualproperty; Transactions involvingsubstantialpaymenttowards agreement; Details ofanyjointventureorcollaboration liability claimsofsubstantialnature,ifany; Any issuewhichinvolvespossiblepublicorproduct services providedbytheCompany; by theCompanyorsubstantialnon-paymentfor Any materialdefaultinfinancialobligationstoand any materialeffluentorpollutionproblems,ifany; Fatal orseriousaccidents,dangerousoccurrences, prosecution noticesandpenaltynotices,ifany; Material importantshowcause,demand, officers justbelowboardlevel; Information onrecruitment/remunerationofsenior decisions; Report onactiontakenlastboardmeeting subsidiary companies; Significant transactionsandarrangementsbythe Update onCorporateSocialResponsibilityactivities; Regular businessupdates; Related partytransactions; of theBoard; Proposals requiringstrategicguidanceandapproval Disclosures receivedfromdirectors; listing requirementsandshareholdersservice; compliance ofanyregulatory,statutorynatureor ‘Exceptions Reports’whichincludesnon- Quarterly compliancecertificateswiththe 7/21/2009, 9:23 PM 79 BHARTI AIRTEL ANNUAL REPORT 2008-09 The Company Secretary, in consultation with the requirements of Section 292A of the Companies Act, Chairman, prepares the agenda of the Board and 1956 and revised Clause 49 of the Listing Agreement. committee meetings. The detailed agenda is sent to The Company Secretary is the secretary to the the Board members at least a week before the Board Committee. The CEO & Joint Managing Director, Chief meeting. In special and exceptional circumstances, Financial Officer, Director – Internal Assurance, additional or supplementary item(s) on the agenda are Corporate Director – Finance, statutory auditors and permitted to be taken up as ‘any other item’. Sensitive the internal auditors are permanent invitees. To ensure subject matters may be discussed at the meeting proper internal control at each audit committee meeting, without written material being circulated in advance. the Committee invites the head of one of the functions Code of Conduct to make a brief presentation on action plans to improve the level of internal control. In addition, other senior The Board has laid down a Code of Conduct for all management members are also invited to the committee directors and senior management personnel of the meetings to present reports on the respective items Company, which is also available on the website of the being discussed at the meeting from time to time. Company (www.airtel.in). The Code is applicable to all Internal auditors are invited to present their views on the Board members and direct reportees of the Chairman risk management and internal control systems. and Managing Director and CEO & Joint Managing Key responsibilities of the audit committee Director at senior management level. The Code is circulated annually to all the Board members and senior • Oversight of the Company’s financial reporting management and the compliance of the same is affirmed process and the disclosure of its financial by them annually. In addition, a quarterly confirmation information to ensure that the financial statements of no transactions/transactions entered into by the are correct, sufficient and credible; senior management with the Company is also procured • Recommending to the Board, the appointment, re- and placed before the board. A declaration signed by appointment and, if required, the replacement or the CEO and Joint Managing Director regarding removal of the statutory auditor, internal auditors affirmation of the compliance with the Code of Conduct and the determination of their audit fees; by Board and senior management is appended at the end of this report. • Approval of payment to statutory auditors for any other services rendered by the statutory auditors; In addition to the Code of Conduct for the Board members and senior management, the Company has • Reviewing, with the management, annual financial also laid down a Code of Conduct for all the employees statements before submission to the Board for of the Company. approval, with particular reference to: Regular training programs are conducted by senior o Matters required to be included in the directors’ management across locations to explain and reiterate responsibility statement, which form part of the the importance of adherence to the code. All employees Board’s report in terms of clause (2AA) of are expected to confirm compliance to the code section 217 of the Companies Act, 1956; annually. o Changes, if any, in accounting policies and practices and reasons for the same; BOARD COMMITTEES o Major accounting entries involving estimates In compliance with the Listing Agreements (both based on the exercise of judgment by mandatory and non-mandatory), the SEBI Regulations, management; and to focus effectively on the issues and ensure expedient resolution of the diverse matters, the Board o Significant adjustments made in the financial has constituted a set of committees with specific terms statements arising out of audit findings; of reference and scope. The committees operate as o Compliance with listing and other legal empowered agents of the Board as per their charter/ requirements relating to financial statements. terms of reference. Constitution and charter of the Board committees is also available on the website of the o Approval of all related party transactions; Company at www.airtel.in o Qualifications in the draft audit report;

The details of the committees constituted by the Board • Reviewing, with the management, the quarterly are given below: financial statements before submission to the Board Audit committee for approval; Our audit committee comprises of six members, all of • Reviewing, with the management, performance of whom are non-executive directors and four of whom statutory and internal auditors, adequacy of the are independent. The Chairman of the audit committee, internal control systems; N. Kumar is an independent director and has sound • Reviewing the adequacy of internal audit function financial knowledge as well as many years of experience including the structure of the internal audit in general management. The majority of the audit department, staffing and seniority of the official committee members, including the Chairman, have heading the department availability and deployment accounting and financial management expertise. The of resources to complete their responsibilities and composition of the audit committee meets the the performance of the out-sourced audit activity;

2 MDA & CGR 68-91.p65 80 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 Powers oftheAuditCommittee • • • • • • • • • • considered necessary. with relevantexperience and expertise,when advice andtosecuretheattendance ofoutsiders Obtain legalorotherindependent professional employee; and toseekanyinformation itrequiresfromany Investigate anyactivitywithinitstermsofreference 1956. the ListingAgreementandCompaniesAct, stipulated underanylaw,ruleorregulationincluding Board ofdirectorsfromtimetoorasmaybe Such otherfunction,asmaybeassignedbythe Reviewing thefollowing: by theOmbudsman; mechanism andthenatureofcomplaintsreceived Reviewing thefunctioningofwhistleblower dividends) andcreditors,ifany; shareholders (incaseofnonpaymentdeclared payment tothedepositors,debentureholders, Review thereasonsforsubstantialdefaultsin area ofconcern; as wellpost-auditdiscussiontoascertainany commences, aboutthenatureandscopeofaudit Discussion withstatutoryauditorsbeforetheaudit addressed; Framework andthemannerinwhichrisksarebeing Obtaining anupdateontheRiskManagement the mattertoBoard; control systemsofamaterialnatureandreporting suspected fraudorirregularityafailureofinternal by theinternalauditorsintomatterswherethereis Reviewing thefindingsofanyinternalinvestigations findings andfollowupthereon; per theannualauditplan,natureofsignificant the coverageandfrequencyofinternalauditsas Discussion withinternalauditorsrespectto subsidiary companies; investments, ifanymadebytheunlisted The financialstatements,inparticularthe remuneration ofthechiefinternalauditor; The appointment,removalandtermsof weaknesses; Internal auditreportsrelatingtointernalcontrol weaknesses issuedbythestatutoryauditors; Management letters/lettersofinternalcontrol any exceptionstothesecompliances; compliance withlawsandregulations,including Quarterly compliancecertificatesconfirming transactions whicharenotatarms’lengthprice; not inthenormalcourseofbusinessor specific detailsofthetransactions,whichare Statement ofrelatedpartytransactionswith financial conditionandresultsofoperations; Management discussionandanalysisof 81 aehBat itlNneeuiedrco 4 director Non-executive Rakesh BhartiMittal .Appointedasmember ofthecommitteew.e.f.August01,2008; 2. Ceasedtobeamemberofthecommitteew.e.f.August01,2008, 1. Member director information dissemination. processes relatedtothe financial reportingand ombudsman. Itisalsoresponsible foroverseeingthe auditors, internalassurancegroup, internalauditorsand The Auditcommitteeoversees theworkofexternal for theWhistleBlowerMechanism governance process.TheOmbudsmanisresponsible Company toevaluatetherisks,internalcontrolsand responsible forreviewingalltheoperationsof Group headedbyDirector-InternalAssurance,isalso and statutoryrequirements.TheInternalAssurance control systemsandadherencetomanagementpolicies Group, areresponsibleforensuringadequacyofinternal internal auditors,reportingintotheInternalAssurance statements inaccordancewiththeUSGAAP.The independent auditoftheCompany’sfinancial US GAAPauditorsareresponsibleforperforming accounting principles)andforissuingareportthereon. accordance withtheIndianGAAP(generallyaccepted audit oftheCompany’sfinancialstatementsin auditors areresponsibleforperforminganindependent controls andfinancialreportingprocesses.Thestatutory Management isresponsiblefortheCompany’sinternal Listing Agreement. directors aspertherequirementsofClause49 members, includingtheChairman,areindependent The Committeehassix(6)members;two-thirdsofthe for theyearendedMarch31,2009: The AuditCommitteeispleasedtopresentitsreport To theshareholdersofBhartiAirtelLimited: 2009 Audit committeereportfortheyearendedMarch31, Quah KungYang are givenbelow: the meetingsheldduringfinancialyear2008-09, The compositionandtheattendanceofmembersat and January16,2009. the conferencecalli.eJuly18,2008,October17,2008 financial yearthecommitteemetthreetimesthrough in theregularauditcommitteemeeting.During so thatreasonabletimecouldbedevotedtomajorissues committee meetingtodiscussroutineinternalauditissue a conferencecallweekbeforeeveryregularaudit The auditcommitteehasadoptedapracticeofholding four months.MeetingsaregenerallyheldinNewDelhi. 2009. Timegapbetweentwomeetingswaslessthan July 23,2008,October30,2008andJanuary21, met fivetimesi.e.onApril24,2008,25, During thefinancialyear2008-09auditcommittee committee Meetings, attendanceandcompositionofaudit jyLlIdpnetdrco 3 4 4 director Independent director Independent director Independent Francis Heng Pulak ChandanPrasad Arun BharatRam Ajay Lal N Kumar, Attended 1meetingthroughalternatedirector.; Chairman 1 2 7/21/2009, 9:23 PM o-xctv ietr3 Non-executive director o-xctv ietr2 Non-executive director aeoyNumber of Category needn ietr5 Independent director meetings attended 81 BHARTI AIRTEL ANNUAL REPORT 2008-09 In this regard the Committee reports as follows: Key responsibilities of the HR committee i. The Committee has discussed with the Company’s Besides remuneration packages and other benefits of internal auditors and statutory auditors the overall the executive directors, the HR committee also oversees scope and plan for their respective audits. The the functions related to human resource matters of the Committee also discussed the results of the audit, Company. The key responsibilities of the HR committee evaluation of the Company’s internal controls and include the following: the overall quality of financial reporting. • Recruitment and retention strategies for employees;

ii. The management presented to the Committee, the • Employee development strategies; Company’s financial statements and also affirmed that the Company’s financial statements have been • Compensation (including salaries and salary drawn in accordance with the Indian GAAP. Based adjustments, incentives/benefits bonuses, stock options) and performance targets for the Chairman on its review and discussions conducted with the and Managing Director and CEO & Joint Managing management and the statutory auditors, the Audit Director; Committee believes that the Company’s financial statements are fairly presented in conformity with • All human resource related issues; Indian GAAP in all material aspects. The Committee • Other key issues/matters as may be referred by also believes that the financial statements are true the Board or as may be necessary in view of Clause and accurate and provide sufficient information. 49 of the Listing Agreement or any other statutory iii. The Committee reviewed the financial statements provisions. including the investments made by unlisted Meetings, Attendance and Compostion of HR committee subsidiary companies. During the financial year 2008-09, the Committee met iv. The Committee has reviewed the internal controls four times i.e. on April 24, 2008, July 23, 2008, put in place to ensure that the accounts of the October 30, 2008 and January 21, 2009. The Company are properly maintained and that the composition and the attendance of members at the accounting transactions are in accordance with meetings held during the period, are given below: prevailing laws and regulations. In conducting such Member director Category Number of reviews, the Committee found no material meetings discrepancy or weakness in the internal control attended systems of the Company. Bashir Currimjee1 (Chairman) Independent director 3 2 v. The Committee has reviewed the report of the Craig Ehrlich Independent director N.A. Kurt Hellstrom3 Independent director 2 Ombudsman on the functioning of the whistle Mauro Sentinelli Independent director 3 blower mechanism and believes that the Company Nikesh Arora4 Independent director 1 has effective whistle blower mechanism. Donald Cameron5 Independent director 1 Paul O’Sullivan Non-executive director 4 vi. The Committee has reviewed with the management Rajan Bharti Mittal Non-executive director 4 the performance of the statutory and internal 1. Appointed as Chairman of the HR committee w.e.f. April 29, 2009 auditors and has recommended to the board the 2. Appointed as member of the HR committee w.e.f April 29, 2009 re-appointment of M/s S. R. Batliboi & Associates, 3. Ceased to be the Chairman and member of the HR committee Chartered Accountants, Gurgaon as statutory w.e.f April 29, 2009 4. Appointed as member of the Committee w.e.f October 30, 2008; auditors of the Company and Price Waterhouse 5. Ceased to be the member of the Committee w.e.f April 25, 2008 Coopers Private Limited as the internal auditors of the Company for the succeeding term. Remuneration policy for directors In conclusion, the Committee is sufficiently satisfied The remuneration paid to the executive directors, i.e. that it has complied with the responsibilities as outlined Sunil Bharti Mittal - Chairman and Managing Director, Akhil Gupta – Joint Managing Director (till August 1, in the audit committee charter. 2008) and Manoj Kohli – CEO & Joint Managing Director (from August 1, 2008) is recommended by the HR Place : New Delhi N. Kumar committee and approved by the Board of directors within Date : April 29, 2009 Chairman, Audit Committee the limits approved by the shareholders. The remuneration of executive directors has two HR committee components: fixed pay and variable pay (performance linked incentive). While the fixed pay is paid to the In compliance with the non-mandatory requirements of directors on a monthly basis, the performance-linked Clause 49 of the Listing Agreement, we have a incentive paid to the executive directors is based on remuneration committee known as the HR committee. the performance of the individual director. The Committee comprises of six non-executive The performance targets i.e. the key result areas, directors, of which four members, including Bashir together with performance indicators for the executive Currimjee, the Chairman of the committee are directors, based on the balanced score card, are finalised independent directors. The Company Secretary acts as at the beginning of the year. At the end of the year, the secretary of the Committee. The Group Director when the results are announced, the HR committee HR is a permanent invitee. Other senior management evaluates the performance of each of these senior members are also invited to the committee meetings to executives against the targets set and recommends the present reports on the items being discussed at the performance linked incentive for each of them to the meeting. Board for payment.

2 MDA & CGR 68-91.p65 82 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 aehBat itl------2,633,750 - 2,593,750 290,959,474 - - - - • 14,055,635 - • - 595,046 - • - 151,686,373 • - - - - 124,142,805 - - 479,615 • - • ------• - * 80,000 19,615 Total - 80,000 Rakesh BhartiMittal Rajan BhartiMittal 60,000 40,000 - Quah KungYang - Pulak ChandanPrasad Paul O’Sullivan - 60,000 Nikesh Arora N. Kumar - Mauro Sentinelli 80,000 Kurt Hellstrom Francis Heng - Donald Cameron Chua SockKoong Bashir Currimjee Arun BharatRam Ajay Lal Akhil Gupta Non-executive director Manoj Kohli Sunil BhartiMittal Executive director Name ofdirector remuneration: the independentdirectorsareeligibleforfollowing etc. toindependentdirectors.Aspertherevisedpolicy, sitting fees,commission,reimbursementofexpenses revised theexistingpolicyonallpaymentsincluding directors intheirmeetingheldonApril29,2009have etc. toindependentdirectors.However,theBoardof sitting fees,commission,reimbursementofexpenses 23-24, 2006approvedapolicyonallpaymentsincluding The BoardofdirectorsintheirmeetingheldonJanuary during thefinancialyear. number ofmeetingsattendedbytherespectivedirector non-executive independentdirectorsislinkedwiththe non-executive independentdirectors.Compensationof as pertheCompaniesAct,1956isalsopayableto the netprofitofCompanyforyearcalculated approved bytheshareholders,notexceeding1%of meetings attendedbythem.Further,acommission,duly fees withintheprescribedlimitsforBoard/committee The independentnon-executivedirectorsarepaidsitting under: The detailsoftheremunerationpaidbyCompanytoalldirectorsduringfinancialyear2008-2009are as Remuneration todirctors Includes PLIfortheFY2007-2008 relinquishment of hispositionasJointManagingDirector onAugust1,2008. Salary, allowancesandPerformance LinkedIncentivepaidtoMr.AkhilGuptaasJointManagingDirector relatestotheperiodpr No noticeperiodorseverancefee ispayabletoanydirector. no othercontractswithany director. 2006 andAugust1,2008,respectively. Thesearebasedontheapprovalofshareholdersobtained thoughpostalballot.There The Companyhasenteredintocontracts withtheexecutivedirectorsi.e.SunilBhartiMittalandManoj KohlieachdatedOctober and doesnotincludetheremuneration paidtohimpriorthatperiod. The remunerationofManojKohlipertains totheperiodfromAugust1,2008March31,2009during histenureasmanagingdire option duringtheyear. The optionswhicharenotexercisedwilllapseaftertheexpiryof the exerciseperiod.Nootherdirectorhasbeengrantedany at anytimeupto7yearsfromtheGrantDate.Theunexercisedvested optionscanbecarriedforwardthroughouttheexerciseper the periodofthreeyearsinequalproportionwithanoptiontoconvert thestockoptionsintoequityshareseitherinfullor to hisappointmentasJointManagingDirector)atapriceofRs.673 i.e.atadiscountof20%themarketprice,whichwill During theyear,ManojKohliwasgranted4500stockoptionsunder theESOPScheme2005ofCompanyonJuly1,2008(prior applicable lawsanddeductionoftaxatsource. The valueoftheperquisitesiscalculatedasperprovisions the IncomeTaxAct,1961.Theabovepaymentsweresubjectt included. provided onactuarialbasisfortheCompanyasawhole,amount pertainingtothedirectorsisnotascertainableand,theref The salaryandallowanceincludestheCompany’scontributionto the ProvidentFund.Liabilityforgratuityandleaveencashment 83 000---151801,601,850 1,541,850 - - - 60,000 Sitting esallowances Fees 021371,9,3 21,488,690 25,958,292 - - 228,977,242 - - - 11,197,333 595,046 7,989,040 * 10,291,357 132,500,000 17,969,252 95,882,196 Salary and ,4,5 1,621,850 656,495 1,541,850 2,107,750 2,592,750 636,880 - 2,027,750 2,532,750 - - - 1,608,050 1,602,755 - 1,528,050 1,542,755 ------linked incentive efrac eqiie omsinTotal Commission Perquisites Performance executed amongstthemselves. expenses inlinewiththeshareholders’agreements entitled toanyremunerationorreimbursementof shareholders namelyBhartiTelecomandSingtelarenot The non-executivedirectorsrepresentingthekey (ii) INR10,000/-forattendingallthemeetingsof INR10,000/-forattendingeachmeetingofthe (i) as follows: The non-executivedirectorsarealsopaidsittingfees policy onpaymenttoindependentdirectors. profits. Thepaymentofcommissionissubjecttothe sufficient profitswithanoverallceilingof1%net The paymentofaforesaidissubjecttoavailability additional commissionofUS$10000p.a. US$50000p.a. Chairman oftheauditcommitteewillbeentitledtoan directors Non-resident US$ 30000 p.a. Resident Indiandirectors independent directorsshallbeasfollows: independent directorsincludingnewlyappointed The amountofcommissionpayabletoallthe committee oftheBoardatoneoccasion. Board ofdirectors 1,0 110,000 110,000 - - 7/21/2009, 9:23 PM (Amount inRs.) in trenches vest over ore, not stock ior to ctor are iod. 3, is o 83 BHARTI AIRTEL ANNUAL REPORT 2008-09 ESOP compensation committee composition and the attendance of members at the meetings held during the period are given below: The ESOP compensation committee of the Board, constituted in accordance with SEBI (Employee Stock Member director Category Number of Option Scheme and Employee Stock Purchase Scheme) meetings attended Guidelines, 1999, comprises of six non-executive members, four of whom are independent. The Chairman Rajan Bharti Mittal (Chairman) Non-executive director 4 Paul O’Sullivan Non-executive director 4 of the Committee, Mr. Rajan Bharti Mittal is a non- Bashir Currimjee Independent director 3 executive director. The Company Secretary acts as the Donald Cameron1 Independent director 1 secretary of the Committee. Group Director HR is the Kurt Hellstrom2 Independent director 2 permanent invitee. Mauro Sentinelli Independent director 3 Nikesh Arora3 Independent director 1 4 Key responsibilities of the ESOP Compensation Craig Ehrlich Independent director N.A. committee 1. Ceased to be a member of the committee w.e.f April 25, 2008; The key responsibilities of the ESOP compensation 2. Ceased to be a member of the committee w.e.f April 29, committee include the following: 2009 3. Appointed as member of the committee w.e .f October 30, • To formulate ESOP plans and decide on future 2008; grants; 4. Appointed as member of the committee w.e.f April 29, 2009

• To formulate terms and conditions on following Investors’ Grievance committee under the present Employee Stock Option Schemes In compliance with the Listing Agreement requirements of the Company: and provisions of the Companies Act, 1956, the – the quantum of option to be granted under ESOP Company has constituted an Investor Grievance Scheme(s) per employee and in aggregate; Committee. The Committee comprises of four members. Akhil Gupta, non-executive director is the Chairman of – the conditions under which options vested in the committee. The Company Secretary acts as a employees may lapse in case of termination of Secretary to the Committee. employment for misconduct; Key responsibilities of the investors’ grievance – the exercise period within which the employee should exercise the option and that option would committee lapse on failure to exercise the option within the The key responsibilities of the Investors’ Grievance exercise period; committee include the following:

– the specified time period within which the employee • Formulation of procedures in line with the statutory shall exercise the vested options in the event of guidelines to ensure speedy disposal of various termination or resignation of an employee; requests received from shareholders from time to time;

– the right of an employee to exercise all the options • Redressal of shareholders and investor complaints/ vested in him at one time or at various points of grievances e.g. transfer of shares, non-receipt of time within the exercise period; balance sheet, non receipt of declared dividend, etc.; – the procedure for making a fair and reasonable • Approve, register, refuse to register transfer / adjustment to the number of options and to the transmission of shares and other securities; exercise price in case of rights issues, bonus issues and other corporate actions; • Sub-divide, consolidate and / or replace any share or other securities certificate(s) of the Company; – the grant, vest and exercise of option in case of employees who are on long leave; and the procedure • Issue duplicate share /other security(ies) for cashless exercise of options; certificate(s) in lieu of the original share / security(ies) certificate(s) of the Company; – any other matter, which may be relevant for administration of ESOP schemes from time to time. • Approve the transmission of shares or other securities arising as a result of death of the sole/ • To frame suitable policies and systems to ensure that there is no violation of Securities and Exchange any one joint shareholder; Board of India (Insider Trading) Regulations, 1992 • Dematerialize or rematerialize the share certificates; and Securities and Exchange Board of India (Prohibition of Fraudulent and Unfair Trade Practices • Further delegate all or any of the power to any relating to the Securities Market) Regulations, 1995. other employee(s), officer(s), representative(s), consultant(s), professional(s), or agent(s) • Other key issues as may be referred by the Board. The meetings of the Committee are generally held on Meetings, attendence and compostion of ESOP monthly basis, to review and ensure that all investor compensation committee grievances are redressed within a period of 7-10 days During the financial year 2008-2009, the committee from the date of receipt of complaint. These, however, met four times i.e. on April 24, 2008, July 23, 2008, do not include complaints/requests, which are October 30, 2008 and January 21, 2009. The constrained by legal impediments/procedural issues.

2 MDA & CGR 68-91.p65 84 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 aa hriMta o-xctv ietr8 director Non-executive Rajan BhartiMittal India, whoseturnover ornetworth(i.e.paid-up capital subsidiary’ asanunlistedsubsidiary, incorporatedin Clause 49definesa‘material non-listedIndian Subsidiary companies quarterly basis. these committeesarealsoplacedbeforetheBoardon duly approvedbytheBoard.Minutesofmeetings required. Theconstitutionofthiscommitteehasbeen basis. Thecommittesmayalsomeetadditionallyifso of theCompany.TheCommitteemeetsonamonthly requirements andtofacilitatetheseamlessoperations constituted tocaterthevariousday-to-day Committee ofDirectors.Thiscommitteehasbeen also formedafunctionalcommitteecalledthe Nil In additiontotheabovecommittees,Companyhas Other committees 18 which investorsmaysendcomplaints. Nil dedicated e-mailID,[email protected] To redressinvestorgrievances,theCompanyhasa Nil 18 from timetoonvariousmarketsrelatedmatters. 2 the CompanyonclarificationssoughtbyStockExchanges The tabledoesnotincludetheresponsesfurnishedby 15 TOTAL 2 dividend warrants 15 Non–receipt ofdividend/ Non-receipt ofAnnualReport Non-receipt ofsecurities Type ofcomplaint complaints asonMarch31,2009arefollows: satisfaction ofinvestors.Detailstheinvestors’ all thesecomplaints/querieswereresolvedtothe warrants, sharesandannualreports,etc.Asondate, include issuesrelatingtonon-receiptofdividend received bytheCompanyweregeneralinnature,which During thefinancialyear2008-2009,complaints Nature ofcomplaintsandredressalstatus of SEBI(ProhibitionInsiderTrading)Regulations,1992. Agreement withtheStockExchangesandrequirements for complyingwiththerequirementsofListing Secretary actsasComplianceOfficeroftheCompany 2 Vijaya Sampath,GroupGeneralCounsel&Company director Non-executive Compliance Officer Appointedasmemberofthecommitteew.e.fOctober30, 2008 1. Rakesh BhartiMittal Member director 09, aregivenbelow: at themeetingsheldduringfinancialyear2008- 2009. Thecompositionandtheattendanceofmembers November 10,2008,January29,2009andMarch17, July 14,2008,23,October3, met eighttimesi.e.onApril25,2008,May30, During thefinancialyear2008-2009,Committee Grievance committee Meetings, attendanceandcompositionofInvestor Manoj Kohli Akhil Gupta 1 (Chairman) 85 xctv ietr3 Executive director Category o-xctv ietr8 Non-executive director ubrRdesdPending Redressed Number 53 Nil 35 35 Number of meetings attended er[Time] Date AirForceAuditorium 2005-06 AirForceAuditorium 2006-07 AirForceAuditorium 2007-08 Location Year Financial (ii) TheCompanyissuedthepostalballotnoticedated (i) Procedure followed to theChairmanandManagingDirector. Sharma conductedtheprocessandsubmittedherreport scrutinizer forthepostalballotvotingprocess.Ms. Practicing CompanySecretarywasappointedas the postalballotvotingprocess.KiranSharma, Secretary wereappointedaspersonsresponsiblefor and VijayaSampath,GroupGeneralCounsel&Company Sunil BhartiMittal,ChairmanandManagingDirector Person conductingthepostalballotexercise followed bytheCompanyisprovidedhereunder: resolution throughpostalballot.Detailedprocedure During thepreviousyear,wehavepassedoneordinary Postal ballotandpostalprocess 2008. on August21,2006,July19,2007and1, No specialresolutionswerepassedintheAGMsheld Special resolutionspassedatthelastthreeAGMs under: The lastthreeAnnualGeneralMeetingswereheldas GENERAL BODYMEETINGS Exchanges. 49(III)(i) oftheListingAgreementwithStock w.e.f April29,2008,incompliancewiththeClause executive directorontheBoardofBhartiInfratelLimited appointed bytheCompanyasanindependentnon- director oftheCompanyhasbeennominatedand Agreement. NKumar,Independentnon-executive subsidiary asdefinedunderClause49oftheListing Bharti InfratelLimitedisamaterialnon-listedIndian preceding accountingyear. company anditssubsidiariesintheimmediately turnover ornetworthrespectively,ofthelistedholding and freereserves)exceeds20%oftheconsolidated Wednesday, the September24,2008; on orbeforethecloseof businesshourson addressed envelope,soasto reachthescrutinizer return thedulycompletedform intheattachedself- instructions printedonthepostal ballotformand Members wereadvisedto readcarefullythe and othersconcernedundercertificateofposting; addressed envelopesweresenttothemembers statement andthepostalballotformsself- draft resolution,togetherwiththeexplanatory as JointManagingDirectoroftheCompany.The August 5,2008,forappointmentofMr.ManojKohli urt ak e eh [1530 Hrs.(IST)] Subroto Park,NewDelhi urt ak e eh [1530 Hrs.(IST)] Subroto Park,NewDelhi [1530 Hrs.(IST)] Subroto Park,NewDelhi 7/21/2009, 9:23 PM August21,2006 July19,2007 , August01,2008 , , 85 BHARTI AIRTEL ANNUAL REPORT 2008-09 (iii) After due scrutiny of all the postal ballot forms Further for the financial year ended March 31, 2009 received up to the close of the working hours on there were no material individual transactions with September 24, 2008, Ms. Kiran Sharma, Practicing related parties or others, which were not on an arms’ Company Secretary (the Scrutinizer) submitted her length basis. report on Friday, September 26, 2008 before the The related party transactions have been disclosed under close of business hours; Note 20 of Schedule 22 forming part of the Annual (iv) The results of the postal ballot were declared on Accounts. Saturday September 27, 2008. The date of Disclosure on Risk Management declaration of the results of the postal ballot was taken as the date of passing of the ordinary The Company has established an Enterprise wide risk resolution. management (“ERM”) framework to optimally identify and manage risks as well as to address operational, (v) The results of the postal ballot were published in strategic and regulatory risks. This is in compliance with the newspapers, Mint (English) and Hindustan clause 49 of the Listing Agreement. In line with the (Hindi) within 48 hours of the declaration of the Company’s commitment to deliver sustainable value, results and were also placed at the website of the this framework aims to provide an integrated and Company at www.airtel.in organized approach for evaluating and managing risks. Details of voting pattern The output of the Risk Assessment also forms the basis of the Company’s Annual Internal Audit programme. After scrutinizing all the ballot forms received, the scrutinizer reported as under: The Board is informed about the key risks and minimization procedures from time to time. Business Date of declaration 27.09.2008 risk evaluation and management is an ongoing process of results within the Company. Particulars of the Appointment of Manoj Kohli Details of non-compliance with regard to the capital resolutions passed as Joint Managing Director of market the Company There have been no instances of non-compliances by Total valid votes 1,468,765,257 (100%) us and no penalties and/or strictures have been imposed Votes in favour(%) 1,468,756,933 (99.9996%) on us by stock exchanges or SEBI or any statutory authority on any matter related to the capital markets Votes against(%) 5,462 (0.0004%) during the last three years. Proposed Resolutions to be passed through Postal Ballot CEO and CFO certification Process The certificate required under Clause 49(V) of the Listing The Board of directors in their meeting held on April Agreement duly signed by the CEO and CFO was placed 29, 2009 have approved the postal ballot notice to before the Board and the same is provided as annexure obtain the assent or dissent of the shareholders to pass A to this report. the following ordinary/special resolutions: Compliance with the mandatory requirements of Clause • Ordinary Resolution for sub-division of equity shares 49 of the Listing Agreement of Rs. 10 each into two equity shares of Rs. 5 each and amendment in Memorandum of We have complied with all the mandatory requirements Association; of the code of corporate governance as stipulated under the Listing Agreement. We have obtained a certificate • Special Resolution for amendment in Articles of affirming the compliances from S.R. Batliboi & Association; Associates, Chartered Accountants, the statutory • Special Resolution for payment of commission to auditors of the Company and the same is attached to independent non-executive directors. the Directors’ report. DISCLOSURES Adoption of non-mandatory requirements of Clause 49 of the Listing Agreement Disclosure on materially significant related party transactions The Company had adopted the following non-mandatory requirements of Clause 49 of the Listing Agreement: The required statements/disclosures with respect to the related party transactions, are placed before the audit • Remuneration committee committee as well as to the Board of directors, on a We have an HR committee of the Board of directors quarterly basis in terms of Clause 49(IV)(A) and other which also undertakes the functions of remuneration applicable laws for approval. committee. A detailed note on the HR The Company’s major related party transactions are (remuneration) committee has been provided in the generally with its subsidiaries and associates. The ‘Board committees’ section of this report. related party transactions are entered into based on • Shareholders’ Rights and Auditors’ Qualification consideration of various business exigencies such as synergy in operations, sectoral specialization, liquidity The Company has a policy of announcement of the and capital resource of subsidiary and associates. audited quarterly results. The results approved by

2 MDA & CGR 68-91.p65 86 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 www.airtel.in. Company areavailableon theCompany’swebsite investors andothergeneral informationaboutthe reports, latestpresentation made totheinstitutional patterns, officialnewsreleases, financialanalysis Up-to-date financialresults,annualreports,shareholding posted onthewebsite. specific presentationmadetotheanalysts/othersisalso transcript ispostedonthewebsitesoonafter.Any broadcast liveontheCompany’swebsite,and earnings callwithanalystsandinvestors,whichisalso website. Attheendofeachquarterweorganizean (vernacular newspaper)andarealsopostedonour daily newspapers,viz.Mint(Englishdaily)and The quarterlyauditedresultsarepublishedinprominent MEANS OFCOMMUNICATION • • • section website oftheCompanyinInvestorRelations Association oftheCompanyisuploadedon The updatedMemorandumandArticlesof Memorandum andArticlesofAssociations of CompanySecretariesIndia. Secretarial StandardsaslaiddownbytheInstitute The Companyhassubstantiallycompliedwiththe Compliance withtheICSISecretarialStandards has beendeniedaccesstoOmbudsman. Audit Committee.NoemployeeoftheCompany dealt withbytheOmbudsmanarereportedto reported matter.Instancesofseriousmisconduct all appropriateactionsrequiredtoresolvethe and investigateanyconcernsraised,undertakes Ombudsman administersaformalprocesstoreview any fearofretaliationorvictimization.The can raisetheirconcernsinfullconfidence,without policy aimstoensurethatgenuinecomplainants breach oftheCodeConductforemployees.The concerns aboutunethicalconductthatmaybein and processforstakeholderstovoicegenuine Whistle BlowerPolicy),whichoutlinesthemethod We haveadoptedanOmbudsmanPolicy(includes Ombudsman Policy live andtranscriptsarepostedonthewebsite. investors/analysts. TheEarningsCallsarewebcast and themanagementrespondtoqueriesof investors/analysts interactwiththemanagement results, anEarningsCallisorganisedwherethe On thedayofannouncementourquarterly is webcastandalsoairedintheelectronicmedia. In addition,discussionwiththemanagementteam provided inthedirectorsreports. auditors observationmadeintheirreporthavebeen Appropriate managementexplanationstothe the resultstomediabywayofpressrelease. on recordbytheBoardofdirectors,wedisseminate minutes oftheapprovalresults.Oncetaken first submittedtotheStockExchangeswithin15 the Boardofdirectors(orcommitteethereof)are 87 Hindustan ue3,20 23 : April1toMarch31 : June 30,2009 Results forthequarterending year Financial change) Financial Calendar( AirForceAuditorium, 3.30p.m. Friday : Venue : : Time Day : Date Equity shareslisting,stockcodeandlistingfeepayment Plant Locations Dividend pay-outdate Dividend April28,2010,Wednesday Book Closure January22,2010,Friday March 31,2010 : December 31,2009 October30,2009,Friday : 2009 30, September financial year2003-04. Exchange AssociationLimited (Regional)duringthe The Companyde-listeditsshares fromtheDelhiStock Mumbai -400001 Statusoffeepaid of IndiaLimited National StockExchange code Scrip the stockexchange Name andaddressof Exchange Limited The BombayStock Mumbai-400051 Bandra East Bandra-Kurla Complex Exchange Plaza 14 GENERAL SHAREHOLDERS’INFORMATION of theCompanyarelisted. also submittedtothestockexchangeswhereshares quarterly reportsarepostedonourwebsiteand summarized USGAAPfinancialstatements,etc.The market highlights,non-GAAPinformation,ratioanalysis, Company developments,resultsofoperations,stock financial andoperatinghighlights,keyindustry practice ofreleasingaquarterlyreport,whichcontains Since thetimeoflistingshares,wehaveadopteda Dalal Street, Phiroze JeejeebhoyTowers th AnnualGeneralMeeting New Delhi–110010 Subroto Park, August 21,2009 7/21/2009, 9:23 PM Tentative Schedule,subjectto Beingaserviceprovider : OnorafterAugust21,2009 : Rs.2/-pershare(i.e.20%on : Friday,July31,2009– : page no.192. end oftheAnnualReportat Company areprovidedatthe Office addressesofthe plant locations.However,Circle company, BhartiAirtelhasno approval oftheshareholders of 30days),subjecttothe (within thestatutorytimelimit the facevalueofshares) inclusive) days (Both August 21,2009 BHARTIARTL 344Paid 532454 rd July2009,Thursday Paid asapplicable as applicable 87 BHARTI AIRTEL ANNUAL REPORT 2008-09 Share Transfer System thereafter. The authorised officials of the Company approve the transfer and the shares are returned to the 84.28% of the equity shares of the Company are in electronic format. Transfer of these shares is done shareholders. through the depositories without any involvement of Pursuant to Clause 47(c) of the Listing Agreement, we the Company. obtain certificates from a Practicing Company Secretary Transfers of shares in physical form are normally on half-yearly basis to the effect that all the transfers processed within 15 days from the date of receipt, are completed in the statutorily stipulated period. A provided the documents are complete in all respects. copy of the certificate so received is submitted to both All transfers are first processed by the Transfer Agent stock exchanges where the shares of the Company are and are submitted to the Company for approval listed.

Stock market data for the period April 1, 2008 to March 31, 2009 Share price performance in comparison with NSE Nifty and BSE Sensex NSE BSE Month High Low Volume (Nos) High Low Volume (Nos) Apr-08 950.00 778.30 62509786 950.00 777.10 12254601 May-08 979.80 798.00 84104191 919.90 798.00 16005821 Jun-08 887.50 716.00 80546420 888.00 717.20 14372462 Jul-08 861.95 672.55 104531315 861.00 688.00 18959653 Aug-08 886.90 770.60 50713694 886.30 777.10 19525028 Sep-08 848.70 651.00 102175691 839.75 700.00 30429344 Oct-08 819.00 483.00 117788229 806.00 484.00 22004868 Nov-08 748.00 576.50 88599107 740.15 575.95 17626963 Dec-08 758.00 622.00 77947815 756.50 630.00 15033006 Jan-09 725.00 553.35 96192284 725.00 576.00 16582311 Feb-09 679.00 607.05 53556330 678.40 607.00 7365066 Mar-09 637.50 541.10 113553937 637.00 544.00 17390291 Source: www.nseindia.com Source: www.bseindia.com

Bharti Share Price Vs NSE Nifty Bharti Share Price Vs BSE Sensex

Distribution of shareholding By number of shares held as on March 31, 2009

Sl.no. Category No. of shareholders % to holders No. of shares % of shares

1 1 – 5000 188306 96.79% 9048715 0.48% 2 5001 – 10000 2575 1.32% 2021765 0.11% 3 10001 – 20000 1130 0.58% 1676512 0.09% 4 20001 – 30000 409 0.21% 1029762 0.05% 5 30001 – 40000 227 0.12% 804813 0.04% 6 40001 – 50000 178 0.09% 815326 0.04% 7 50001 – 100000 332 0.17% 2419568 0.13% 8 100001 – above 1397 0.72% 1880423335 99.06% TOTAL 194554 100% 1898239796 100%

2 MDA & CGR 68-91.p65 88 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 ISIN fortheCompany’ssharesisINE397D01016. shares oftheCompanywereheldindematerializedform. these depositories.AsonMarch31,2009,over84.28% with anyofthedepositoryparticipantsregistered Limited (CDSL).Theshareholderscanholdourshares Limited (NSDL)andCentralDepositoryServices(India) both thedepositoriesi.e.NationalSecuritiesDepository dematerialised formandareavailablefortradingwith The Company’ssharesarecompulsorilytradedin Dematerlization ofsharesandliquidity S. No. By categoryofholdersasonMarch31,2009 IPublicshareholding II Promoterandpromotergroup I A Institutionalinvestors (A) B Others (B) oa hrhlig189823 Total Shareholding v ninPbi tes2299 1.17 0.34 0.23 22269095 2.89 4.22 6455606 4459591 54786447 20.72 0.10 80072674 393238153 3.07 1804558 58314959 Total PublicShareholding IndianPublic&Others (v) NRIs/OCBs/ForeignNationals (iv) Trusts (iii) BodiesCorporate(foreign) BodiesCorporate(Indian) (ii) (i) ForeignInstitutionalInvestors (iv) Insurancecompanies (iii) FinancialinstitutionsandBanks MutualFundsandUnitTrustofIndia (ii) (i) i)Frinpooes4443321.85 45.30 414744373 859986028 12 Total promotersshareholding Foreignpromoters Indianpromoters (ii) (i) aeoyNo. Category 89 statutory formalities. 111.84% oftheirprincipalamountaftercompletion FCCB’s worthUSD50,000willberedeemedat USD 350,000into65,385equityshares.Thebalance received anoticeforconversionofFCCBs equity shares.InApril2009,thecompanyhasfurther outstanding FCCB,whichwereconvertibleinto74,754 On March31,2009theCompanyhadUSD0.4mn convertible into93,408equitysharesoftheCompany. conversion ofFCCBsaggregatingtoUSD0.5mn the year,wereceivedonenoticefromabondholderfor initial conversionpriceofRs.233.17pershare.During into fullypaidequitysharesofRs.10/-pershare,atan after June12,2004uptoApril2009bytheholders due in2009.TheBondswereconvertibleatanytime 115,000,000 zerocouponconvertiblebonds(“Bonds”), During theyear2004-05,CompanyissuedUSD Outstanding GDRs/ADRs/warrants/options Stock ExchangeofIndiaLimited. at theBombayStockExchangeLimitedandNational The equitysharesoftheCompanyarefrequentlytraded 7/21/2009, 9:23 PM 2599 32.85 623509395 434167.15 74730401 181 0.11 2108312 fsae %ageofholding of shares 76100.00 9796 89 BHARTI AIRTEL ANNUAL REPORT 2008-09 Communication addresses For Corporate Communication related matters Senjam Raj Sekhar For corporate governance and other secretarial related Vice President-Corporate Communication matters Bharti Airtel Limited Vijaya Sampath Unitech World Cyber Park Group General Counsel and Company Secretary Tower - A, 4th Floor, Bharti Airtel Limited Sector - 39, Gurgaon -122 001 Aravali Crescent, Telephone no.: +91 124 4552222 1, Nelson Mandela Road, Fax no.: +91 124 455 2233 Vasant Kunj, Phase - II Email: [email protected] New Delhi 110 070 Registrar & Transfer Agent Telephone no. +91 11 46666100 Karvy Computershare Pvt. Ltd. Fax no. +91 11 46666137 Plot No. 17-24, Vittalrao Nagar Email: [email protected] Madhapur For queries relating to Financial Statements Hyderabad 500 081 Harjeet Kohli Ph No. 040-23420815-821 Corporate Head - Treasury & Investor Relations Fax No. 040-23420814 Bharti Airtel Limited E-mail id: [email protected] Aravali Crescent, Website www.karvy.com 1, Nelson Mandela Road, Toll Free No. 1-800-3454001 Vasant Kunj, Phase - II, New Delhi 110 070 Telephone no. +91 11 46666100 Fax no. +91 11 46666137 Email: [email protected]

2 MDA & CGR 68-91.p65 90 7/21/2009, 9:23 PM 2 MDA&CGR 68-91.p65 ended March31,2009 affirmation ofcompliancewiththeCodeConductforDirectors andSeniorManagementinrespectoffinancialyear I herebyconfirmthattheCompanyhasobtainedfromallmembersofBoardandSeniorManagementteam, Annexure B Wehavereviewedfinancialstatementsandthecash (a) hereby certifythat: Airtel Limited,tothebestofourknowledgeandbelief Srikanth Balachandran,ChiefFinancialOfficerofBharti We, ManojKohli,CEO&JointManagingDirectorand Certification Chief ExecutiveOfficer(CEO)/ChiefFinancial(CFO) Annexure A c Weacceptresponsibilityforestablishingand (c) Therearenotransactionsenteredintobythe (b) lc e eh CEO&JointManagingDirector Place : New Delhi Date :April29,2009 Annexures i)thesestatementstogetherpresentatrueand (ii) thesestatementsdonotcontainanymaterially (i) and: flow statementsfortheyearended31 auditors andtheAuditCommittee,deficienciesin to financialreportingandwehavedisclosedthe internal controlsystemsoftheCompanypertaining and thatwehaveevaluatedtheeffectivenessof maintaining internalcontrolsforfinancialreporting or violativeoftheCompany’scodeconduct. Company duringtheyearthatarefraudulent,illegal applicable lawsandregulations. compliance withexistingaccountingstandards, fair viewofthecompany’saffairsandarein contain statementsthatmightbemisleading; untrue statementoromitanymaterialfact 91 st March2009 Declaration d Wehaveindicatedtotheauditorsandaudit (d) Manoj Kohli Srikanth Balachander Srikanth CFO Place :NewDelhi Date :April28,2009 CEO &JointManagingDirector Manoj Kohli ii Instancesof (iii) Significantchangesintheaccountingpolicies (ii) Significantchangesintheinternalcontrolover (i) committee: deficiencies. have takenorproposetotakerectifythese if any,ofwhichweareawareandthesteps the designandoperationsofsuchinternalcontrols, control systemoverfinancialreporting. a significantroleinthecompany’sinternal any, ofthemanagementoranemployeehaving become awareandtheinvolvementtherein,if statements; and disclosed inthenotestofinancial during theyearandthatsamehasbeen financial reportingduringtheyear; 7/21/2009, 9:23 PM significant fraudofwhichwehave For Bharti AirtelLimited Manoj Kohli 91 BHARTI AIRTEL ANNUAL REPORT 2008-09 15 Secretarial audit report

The Board of directors, 1. Maintenance of various statutory and non- Bharti Airtel Limited, statutory registers and documents and making Aravali Crescent, necessary changes therein as and when the 1, Nelson Mandela Road, occasion demands. Vasant Kunj, Phase II, 2. Filing with the Registrar of Companies the New Delhi – 110 070, India. forms, returns and resolutions. I have examined the registers, records and documents of Bharti Airtel Limted (the Company) for the financial 3. Service of the requisite documents by the year ended 31st March 2009 in the light of the provisions Company on its members, Registrar and Stock contained in – Exchanges.

• The Companies Act, 1956 and the Rules made 4. Composition of the Board, appointment, thereunder. retirement and resignation of directors.

• The Depositories Act, 1996 and the Rules made 5. Remuneration of executive and independent thereunder and the bye-laws of the Depositories who directors. have been given the requisite Certificate of 6. Obtaining the approvals for various acts of the Registration under the Securities and Exchange Company. Board of India Act, 1992. 7. Service of notice and agenda of board meetings • The Securities Contracts (Regulation) Act, 1956 and and meetings of the committee of directors. the Rules made thereunder. 8. Meetings of the Board and its committees • The Securities and Exchange Board of India Act, 1992 and the Rules, Guidelines and Regulations 9. Holding of annual general meeting and made thereunder including: production of the various registers thereat.

The Securities and Exchange Board of India 10. Recording the minutes of proceedings of board (Substantial Acquisition of Shares and Takeovers) meetings, committee meeting and of the annual Regulations, 1997. general meeting.

The Securities and Exchange Board of India 11. Appointment, change in the appointment and (Prohibition of Insider Trading Regulations), 1999, remuneration of Auditors. and 12. Registration of transfer of shares held in The Securities and Exchange Board of India physical mode. (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999. 13. Dematerialisation and rematerialisation of shares. • The listing agreement with the National Stock Exchange and with the Bombay Stock Exchange. 14. Investment of company’s surplus funds. A. Based on my examination and verification of the 15. Execution of contracts, affixation of common aforementioned records made available to me and seal, registered office and the name of the according to the clarifications and explanations given Company. to me by the Company, I report that the Company 16. Conferment of options and allotment of shares has, in my opinion, complied with the provisions of under the Employees Stock Option Scheme of the Companies Act, 1956 and the Rules made the Company. thereunder and of the various Acts detailed above and the Rules, Regulations and Guidelines made 17. Requirements of the Securities and Exchange thereunder and of the Memorandum and Articles of Board of India (Substantial Acquisition of Shares Association of the Company, with regard to: and Takeovers) Regulations 1997.

3 Secretarial Audit Report 92-93.p65 92 7/21/2009, 9:23 PM 3 Secretarial AuditReport92-93.p65 Ifurtherreportthat– B 9 Generally withregardtootherrequirements 19. Requirementssetoutinthelistingagreement 18. i thedirectorsofCompanyhavecomplied (i) Regulations andGuidelinesmadethereunder. spelt outintheaforementionedActsandRules, with theaforementionedstockexchanges. business, and into bytheCompanyinpursuingitsnormal and interestorconcerninthecontractsentered which theyaredirectors,theirshareholding committees oftheboardcompanies to theirotherdirectorships,membershipof making ofdisclosures,declarationsinregard with thevariousrequirementsrelatingto 93 ae:April20, : Date NewDelhi : Place i)therewasnoprosecutioninitiated againstor (ii) thereunder oronitsdirectorsandofficers. Rules, RegulationsandGuidelinesmade Company undertheaforementionedActs, and nofineorpenaltieswereimposedonthe show causenoticereceivedbytheCompany 7/22/2009, 8:14 PM 09CertificateofPracticeNo.203 2009 Practicing CompanySecretary T.V. Narayanaswamy 93 BHARTI AIRTEL ANNUAL REPORT 2008-09 16 Standalone Financial Statements with Auditors’ Report Auditors’ Report to The Members of Bharti Airtel Limited

1. We have audited the attached Balance Sheet of iv. In our opinion, the balance sheet, profit and loss Bharti Airtel Limited (‘the Company’) as at March account and cash flow statement dealt with by 31, 2009 and also the Profit and Loss account and this report comply with the accounting standards the Cash Flow Statement for the year ended on referred to in sub-section (3C) of section 211 of that date annexed thereto. These financial the Companies Act, 1956; statements are the responsibility of the Company’s v. On the basis of the written representations management. Our responsibility is to express an received from the directors, as on March 31, opinion on these financial statements based on our 2009, and taken on record by the Board of audit. Directors, we report that none of the directors 2. We conducted our audit in accordance with auditing is disqualified as on March 31, 2009 from being standards generally accepted in India. Those appointed as a director in terms of clause (g) of Standards require that we plan and perform the audit sub-section (1) of section 274 of the Companies to obtain reasonable assurance about whether the Act, 1956. financial statements are free of material vi. In our opinion and to the best of our information misstatement. An audit includes examining, on a and according to the explanations given to us, test basis, evidence supporting the amounts and the said accounts give the information required disclosures in the financial statements. An audit also by the Companies Act, 1956, in the manner so includes assessing the accounting principles used required and give a true and fair view in and significant estimates made by management, as conformity with the accounting principles well as evaluating the overall financial statement generally accepted in India; presentation. We believe that our audit provides a reasonable basis for our opinion. a) in the case of the balance sheet, of the state of affairs of the Company as at March 31, 3. As required by the Companies (Auditor’s Report) 2009; Order, 2003 (as amended) issued by the Central Government of India in terms of sub-section (4A) of b) in the case of the profit and loss account, of Section 227 of the Companies Act, 1956, we the profit for the year ended on that date; enclose in the Annexure a statement on the matters and specified in paragraphs 4 and 5 of the said Order. c) in the case of the cash flow statement, of 4. Further to our comments in the Annexure referred the cash flows for the year ended on that to above, we report that: date. i. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit; For S.R. BATLIBOI & ASSOCIATES ii. In our opinion, proper books of account as Chartered Accountants required by law have been kept by the Company per Prashant Singhal so far as appears from our examination of those Partner books; Membership No.: 93283 iii. The balance sheet, profit and loss account and Place : New Delhi cash flow statement dealt with by this report are in agreement with the books of account; Date : April 29, 2009

4 Auditor Report 94-97.p65 94 7/21/2009, 9:23 PM 4 AuditorReport 94-97.p65 i)Inouropinionandaccordingtotheinformation (iv) TheCompanyhasneithergrantednortakenany (iii) Theinventory(otherthanstocks withthird (a) (ii) TheCompanyhasmaintainedproperrecords (a) (i) Re: BHARTIAIRTELLIMITED even date Annexure referredtoinparagraph3ofourreport inventory, fixedassetsand for thesaleofgoods the natureofitsbusiness for thepurchaseof commensurate withthesize oftheCompanyand there isanadequateinternal controlsystem do notexistforobtainingcomparativequotations, special natureforwhichsuitablealternativesources explanation thatcertainitemspurchasedareof and explanationsgiventous,havingregardthe for thecurrentyear. Order, 2004arenotapplicabletotheCompany the Companies(Auditor’sReport)(Amendment) (Auditor’s Report)Order,2003,asamendedby Accordingly, clauses(iii)oftheCompanies under section301oftheCompaniesAct,1956. or otherpartiescoveredintheregistermaintained loans, securedorunsecured,tocompanies,firms TheCompanyismaintainingproperrecords (c) Theproceduresofphysicalverification (b) Therewasnosubstantialdisposaloffixed (c) Thecapitalisedfixedassetsarephysically (b) the frequencyofverificationisreasonable. management duringtheyear.Inouropinion, parties) hasbeenphysicallyverifiedbythe details andsituationoffixedassets. showing fullparticulars,includingquantitative were noticedonphysicalverification. of inventoryandnomaterialdiscrepancies of theCompanyandnatureitsbusiness. reasonable andadequateinrelationtothesize inventory followedbythemanagementare assets duringtheyear. noticed onsuchverification. informed, nomaterialdiscrepancieswere company andnatureofitsassets.As reasonable havingregardtothesizeof during theyear,whichinouropinionis been physicallyverifiedbythemanagement fixed assetsandcapitalworkinprogresshas progress. Pursuanttotheabove,aportionof plan tophysicallyverifycapitalworkin year, themanagementhadalsodesigneda items overaperiodofthreeyears.Duringthe regular programmedesignedtocoverallthe verified bythemanagementaccordingtoa 95 i)(a) (ix) Wehave (viii) Inouropinion,the (vii) TheCompanyhasnot (vi) Accordingtothe informationandexplanations (v) c Accordingtotherecords oftheCompany, (c) According totheinformationandexplanations (b) or complete. with aviewtodeterminewhethertheyareaccurate however, madeadetailedexaminationofrecords have beenmadeandmaintained.Wenot, prima facie,theprescribedaccountsandrecords Companies Act,1956,andareoftheopinionthat of costrecordsundersection209(1)(d)the by theCentralGovernmentformaintenance maintained byCompanypursuanttotherulesmade its business. system commensuratewiththesizeandnatureof framed thereunder. 58AA oftheCompaniesAct,1956andrules the publicwithinmeaningofSections58Aand 301 oftheCompaniesAct,1956. entered intheregistermaintainedundersection referred toinsection301thatarerequiredbe transactions pursuanttocontractsorarrangements provided bythemanagement,thereareno internal controlsystem. failure tocorrectmajorweaknessesintheaforesaid across norhavebeeninformedofanycontinuing explanations giventous,wehaveneithercome Company, andaccordingtotheinformation examination ofthebooksandrecords and services.Further,onthebasisofour (also referNote3(b)onSchedule 21): cess onaccountofanydispute, areasfollows wealth-tax, servicetax,customs dutyand dues outstandingofincome-tax, sales-tax, months fromthedatetheybecamepayable. at theyearend,foraperiodofmorethansix undisputed statutorydueswereoutstanding, tax, sales-tax,customsduty,cessandother insurance, income-tax,wealth-tax,service in respectofprovidentfund,employees’state given tous,noundisputedamountspayable duty isnotapplicabletotheCompany. in fewcases applicable toit cess andothermaterialstatutorydues tax, wealth-tax,servicecustomsduty, employees’ stateinsurance,income-tax,sales- investor educationandprotectionfund, statutory duesincludingprovidentfund, with appropriateauthoritiesundisputed The Companyis 7/21/2009, 9:23 PM broadly reviewedthebooksofaccounts . Theprovisionsrelatingtoexcise Company hasaninternalaudit though therehasbeendelays generally accepted anydepositsfrom regularindepositing 95 BHARTI AIRTEL ANNUAL REPORT 2008-09 Name of the Statutes Nature of Amount Period to Forum where the dispute the dues Disputed Which it is pending (in Rs ‘000) Relates Andhra Pradesh VAT Act Sales Tax 2,359,596 2005-08 High Court of Andhra Pradesh Andhra Pradesh VAT Act Sales Tax 228,064 * 2000-02 Deputy Commissioner Appeals Gujrat Sales Tax Act Sales Tax 928 2006-07 Commissioner (Appeals) West Bengal Sales Tax Act Sales Tax 402 1996-97 DCCT - Appellate Stage West Bengal Sales Tax Act Sales Tax 14 1997-98 The Appelate Authority West Bengal Sales Tax Act Sales Tax 928 * 2006-07 Commissioner (Appeals) West Bengal Sales Tax Act Sales Tax 48,268 2004-05 West Bengal Tax Tribunal West Bengal Value Added Tax Sales Tax 324,846 2005-06 DCCT Appeal The Central Sales Tax Act Sales Tax 203 2005-06 DCCT Appeal UP VAT Act Sales Tax 12,178 2002-09 Assessing Officer Central Sales Tax Act Sales Tax 35,836 2003-05 Joint Commissioner Appeals UP VAT Act Sales Tax 505 2003-04 & Joint Commissioner Appeals 2006-07 UP VAT Act Sales Tax 7,600 2006-07 High Court of Judicature at Allahabad, Lucknow Bench UP VAT Act Sales Tax 33 2008-09 Assisstant Commissioner of Sales tax Haryana Sales tax Sales Tax 2,797 2002-04 Joint commissioner Punjab Sales Tax Act Sales Tax 611 2002-03 Jt. Director (Enforcement) Madhya Pradesh Commercial Sales Tax Act Sales Tax 21,720 1997-01 & Deputy Commissioner Appeals 2003-05 UP VAT Act Sales Tax 1,125 2002-05 Assistant Commissioner Karnataka Sales Tax Act Sales Tax 290,920 2005-06 JC Appeals Tamil Nadu Sales Tax Act Sales Tax 634,279 * 1996-01 Commissioner (Appeals) J&K General Sales Tax Sales Tax 8,433 2005-06 Jammu and Kashmir Appellate Authority Sub Total (A) 3,979,286 Finance Act,1994 Service Tax 371,032 1997-01 & Customs, Excise and (Service Tax Provisions) 2002-08 Service Tax Appelate Tribunal Finance Act,1994 Service Tax 62,125 2002-06 Commissioner Appeals (Service Tax Provisions) Finance Act,1994 Service Tax 445 2004-06 Deputy Commisioner Appeals (Service Tax Provisions) Finance Act,1994 Service Tax 231,021 2000-01 & Suprintendent of Mohali (Service Tax Provisions) 2005-08 Finance Act,1994 Service Tax 3,449 2006-07 Joint Commissioner of (Service Tax Provisions) Central Excise Finance Act,1994 Service Tax 1,654,990 * 1997-99 & Commissioner Appeals (Service Tax Provisions) 2002-09 Finance Act,1994 Service Tax 8,913 2003-04 High Court (Service Tax Provisions) Finance Act,1994 Service Tax 195,585 * 2002-03 & Deputy Commissioner Appeals (Service Tax Provisions) 2006-07 Finance Act,1994 Service Tax 532 1996-00 Customs, Excise and Service Tax (Service Tax Provisions) Appelate Tribunal, Mumbai Finance Act,1994 Service Tax 966 1995-96 Additional Commissioner (Service Tax Provisions) Finance Act,1994 Service Tax 1,166 2004-05 Assistant Commissioner of (Service Tax Provisions) Service Tax Finance Act,1994 Service Tax 3,657 2007-2008 Joint Commissioner, Service Tax (Service Tax Provisions) Sub Total (B) 2,533,881

4 Auditor Report 94-97.p65 96 7/21/2009, 9:23 PM 4 AuditorReport 94-97.p65 (xvi) Accordingtotheinformationandexplanations (xv) Inouropinion, (xiv) Inour (xiii) Accordingtotheinformationandexplanations (xii) 2,198,348 Based onourauditproceduresandasperthe (xi) 2,663,204 TheCompanyhas noaccumulatedlossesatthe (x) Act Custom Act Custom *The CompanyhasdepositedtotalamountofRs.1,207,425thousandinrespectsuchcases. Sub Total(D) Customs Act,1962 Customs Act,1962 Sub Total(C) IncomeTax Income Income TaxAct,1961 Income TaxAct,1961 noeTxAt 91IncomeTax Income TaxAct,1961 obtained. applied forthepurposewhich theloanswere to usbythemanagement, termloanswere Based oninformationandexplanationsgiven interest oftheCompany. our opinionarenotprima-facieprejudicialtothe institutions, thetermsandconditionswhereofin for loanstakenbyothersfrombanksandfinancial given tous,theCompanyhasguarantee Company. 2003 (asamended)arenotapplicabletothe 4(xiv) oftheCompanies(Auditor’sReport)Order, investments. Accordingly,theprovisionsofclause trading inshares,securities,debenturesandother not applicabletotheCompany. (Auditor’s Report)Order,2003(asamended)are the provisionsofclause4(xiii)Companies a nidhi/mutualbenefitfundsociety.Therefore, and othersecurities. security bywayofpledgeshares,debentures granted loansandadvancesonthebasisof records producedtous,theCompanyhasnot given tousandbasedonthedocuments holders. to afinancialinstitution,bankordebenture Company hasnotdefaultedinrepaymentofdues management, weareoftheopinionthat information andexplanationsgivenbythe preceding financialyears. cash lossesinthecurrentandimmediately end ofthefinancialyearandithasnotincurred opinion, theCompanyisnotachitfundor 97 the Companyisnotdealinginor a ,5,3 2003-2009 2,454,836 Tax 2,095,298 0,5 2007-08 103,050 100,313 108,055 x)The (xx) TheCompany (xix) (xviii) Accordingtotheinformationand explanations (xvii) ae:April : Date NewDelhi : Place Membership No.93283 Partner per PrashantSinghal Chartered Accountants For S.R.BATLIBOI&ASSOCIATES Accordingtotheinformationandexplanations (xxi) end. respect ofdebenturesoutstandingattheyear 301 oftheCompaniesAct,1956. covered intheregistermaintainedundersection allotment ofsharestopartiesorcompanies The Companyhasnotmadeanypreferential (primarily representedbyfixedassets). have beenusedforlong-terminvestment basis (primarilyrepresentedbycapitalcreditors) to Rs.32,149,875thousandraisedonshort-term balance sheetoftheCompany,fundsamounting given tousandonoverallexaminationofthe Company duringtheyear estimated amounts,hasbeenrecoveredbythe controls andRs.6,100thousand,outofsuch appropriate stepsweretakentostrengthen detected bythemanagementforwhich by externalpartiesRs.150,516thousand employees estimatedatRs.13,095thousandand course ofouraudit the Companynoticedorreportedduring relied uponbyus,therewerenofraudsonor furnished bythemanagement,whichhavebeen issues duringtheyear. Company hasnotraisedanymoneybypublic 1996-1997 & High Court High 1996-1997 & 7/21/2009, 9:23 PM 29, 2009 1999-02 & Appelate Tribunal Appelate 1999-02& 2002-2004 010 Customs,ExciseandServiceTax 2001-04 & 1996-97 & Income Tax Income 1996-97 & 2005-06 2006-07 has createdsecurityorchargein except fewcasesoffraudby Customs (Appeals) Commissioner of Appelate Tribunal,Mumbai Income Tax(Appeals) Commissioner of . 97 BHARTI AIRTEL ANNUAL REPORT 2008-09 Balance Sheet as at March 31, 2009

Particulars Schedule As at As at No. March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SOURCES OF FUNDS Shareholder’s Funds Share Capital 1 18,982,398 18,979,074 Share Application Money Pending Allotment 2,933 12,318 Employee Stock Options Outstanding 1,983,331 1,251,370 Less: Deferred Stock Compensation 824,092 1,159,239 687,353 564,017 (Refer Note 21 on Schedule 21 and Note 27 on Schedule 22) Reserves and Surplus 2 256,295,074 182,859,525 Loan Funds Secured Loans 3 517,304 524,244 Unsecured Loans 4 76,619,167 65,179,172 Deferred Tax Liability (Net) - 638,684 (Refer Note 13 on Schedule 21 and Note 26 on Schedule 22) Total 353,576,115 268,757,034 APPLICATION OF FUNDS Fixed Assets 5 Gross Block 372,667,023 281,156,516 Less: Accumulated Depreciation/Amortisation 122,533,438 90,850,041 Net Block 250,133,585 190,306,475 Capital Work in Progress 25,666,693 27,510,788 275,800,278 217,817,263 Investments 6 117,777,582 109,528,528 Deferred Tax Asset (Net) 3,271,103 - (Refer Note 13 on Schedule 21 and Note 26 on Schedule 22) Current Assets , Loans and Advances Inventory 7 621,510 568,607 Sundry Debtors 8 25,500,488 27,764,572 Cash and Bank Balances 9 22,516,027 5,029,390 Other Current Assets 10 1,197,127 997,269 Loans and Advances 11 44,414,947 28,238,823 94,250,099 62,598,661 Less: Current Liabilities and Provisions 12 Current Liabilities 131,179,816 119,090,690 Provisions 6,344,004 2,098,762 137,523,820 121,189,452 Net Current Assets (43,273,721) (58,590,791) Miscellaneous Expenditure (To the extent not written off or adjusted) 13 873 2,034 Total 353,576,115 268,757,034 Statement of Significant Accounting Policies 21 Notes to the Financial Statements 22

As per our report of even date The Schedules referred to above and Notes to the Financial Statements form an integral part of the Balance Sheet For S.R. BATLIBOI & ASSOCIATES For and on behalf of the Board of Directors of Bharti Airtel Limited Chartered Accountants per Prashant Singhal Sunil Bharti Mittal Manoj Kohli Partner Chairman and Managing Director CEO & Joint Managing Director Membership No: 93283 Place : New Delhi Srikanth Balachander Vijaya Sampath Date : April 29, 2009 Chief Financial Officer Group General Counsel & Company Secretary

5 Airtel main 98-148.p65 98 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 and Taxation Depreciation, Amortisation,CharityandDonation Profit beforeOtherIncome,FinanceExpense(Net), rftbfr a 165376 22 21 81,615,367 Notes totheFinancialStatements Statement ofSignificantAccountingPolicies Schedule 22) (Refer Note18onSchedule21and28 Earnings pershare Earnings pershare Profit carriedtoBalanceSheet Profit broughtforward Profit afterTax Tax Expense MAT credit Profit beforeTax e rsatSnhlSnlBat itlManoj Kohli Ch Sunil Bharti Mittal : The SchedulesreferredtoaboveandNotestheFinancialStatements Date New : Place Membership No:93283 Partner per PrashantSinghal Chartered Accountants For S.R.BATLIBOI&ASSOCIATES As per our report of even date 172,402,847 167,740,055 Schedule Charity andDonationTaxation Finance Expense(Net),Depreciation,Amortisation, Profit beforeLicenceFee,OtherIncome, Total Expenditure EXPENDITURE INCOME Particulars for the year endedMarch31,for the 2009 Profit mriain Restructuring (ReferNote2(b)onSchedule22) Less :AmountwithdrawnfromReserveforBusiness Bharti InfratelLtd(ReferNote2(b)onSchedule22) Loss onTransferofTelecomInfrastructureto Trust forpolitical Rs. 200,000thousandpaidtoBhartiElectoral Charity andDonation[(Rs.Nil(March31,2008 Amortisation Depreciation Finance Expense(net) Other Income a nDvdn 4,1 - 645,212 (1,682,365) (3,959,059) Tax onDividend Proposed Dividendon Transferred to Transferred fromDebentureRedemptionReserve - FringeBenefit on Schedule22) (Refer Note13onSchedule21and26 - DeferredTax (March 31,2008Rs.959,169thousand) Includes TaxofRs.Nilthousandforearlieryears - CurrentTax earlier year(March31,2008Rs.241,767thousand) Includes MATcreditofRs.1,093,362thousandfor cesCags 2041940,385,333 52,034,149 Licence feeandSpectrum Administrative andOther Sales andMarketing Personnel Cost ofGoodsSold Network Operating Access Charges Sale ofGoods Service Revenue pi 9 09 he iaca fie GroupGeneralCounsel& CompanySecretary ChiefFinancialOfficer April 29,2009 Delhi (inRs.)-Basic (inRs.)-Diluted General Reser a 358,731 Tax upss]purposes)] 99 andLossAccount Equity Shares charges (revenueshare) e6,000,000 ve imnadMngn ietrCEO&Joint ManagingDirector Director Managing and airman Srikanth Balachander Vijaya Sampath Vijaya SrikanthBalachander ForandonbehalfoftheBoardDirectorsBhartiAirtelLimited o ac 1 09March31,2008 March31,2009 No. 20 19 18 17 16 15 14 o h ereddFortheyearended For theyearended form anintegralpartoftheProfit&LossAccount - - 3,1,9 106,847,872 131,918,294 8,7,6 118,194,797 55,339,252 184,973,262 117,972,158 4,4,0 257,035,096 256,647,513 340,142,902 339,995,752 7/21/2009, 9:23 PM (1,396, 1,3,4 4,837,080 17,639,842 2,7,2 19,429,499 17,849,080 13,341,852 20,875,328 21,763,991 14,336,407 63,268,921 5817135,821,761 7011462,855,545 62,441,922 67,001,104 77,438,385 32,062,839 147382,358,581 1,407,368 ,7,1 9,173,614 3,796,480 1,788,151 R.‘0)(Rs.‘000) (Rs. ‘000) 124,051 4,5 147,150 219,463 07 32.87 32.91 413,623 40.79 40.80 4,411 0)(241, 304) (57,396,005) 57,396,005 132,686,084 124,349,012 31,665,825 33,004,746 25,838,212 9,725,423 2,660,709 8,835,340 317,416 372,293 338,502 387,583 767) - - 99 BHARTI AIRTEL ANNUAL REPORT 2008-09 Cash Flow Statement for the year ended March 31, 2009

Particulars For the year ended For the year ended March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

A. Cash flow from operating activities: Net profit before tax 81,615,367 69,725,423 Adjustments for: Depreciation 32,062,839 31,665,825 Interest Expense and other finance charges 4,275,619 3,832,356 Interest Income (1,489,138) (662,988) (Profit)/Loss on Sale of Assets (Net) (38,899) 32,075 (Profit)/Loss on sale of Investments (2,354,840) (577,505) Amortisation of ESOP Expenditure 648,318 331,094 Lease Equalisation/FCCB Premium 2,146,723 1,700,958 Provision for Deferred Bonus 367,076 (114,870) Licence fee Amortisation 1,141,184 1,195,725 Debts/Advances Written off 756,695 1,958,584 Provision for Bad and Doubtful Debts/Advances 2,684,358 1,172,833 (Net of write back) Liabilities / Provisions no longer required written back (497,718) (352,497) Provision for Gratuity and Leave Encashment 214,860 185,183 Provision for Inventory for obsolete/ Damaged stock 228,944 30,824 Unrealized Foreign Exchange (gain) /loss 15,163,507 13,649 Loss/(Gain) from swap arrangements 65,433 97,562 Provision for Wealth Tax 540 (349)

Operating profit before working capital changes 136,990,868 110,233,882

Adjustments for changes in working capital : - (Increase)/Decrease in Sundry Debtors (1,468,398) (11,274,032) - (Increase)/Decrease in Other Receivables (10,791,961) (15,485,319) - (Increase)/Decrease in Inventory (281,847) (109,093) - Increase/(Decrease) in Trade and Other Payables 4,393,903 30,162,801

Cash generated from operations 128,842,565 113,528,239

Taxes (Paid)/Received (10,311,097) (8,929,734)

Net cash from operating activities 118,531,468 104,598,505

B. Cash flow from investing activities:

Adjustments for changes in : Purchase of fixed assets (92,108,430) (100,350,321) Proceeds from Sale of fixed assets 1,940,680 1,483,237 Proceeds from Sale of Investments 273,605,929 175,129,779 Purchase of Investments (279,523,969) (189,776,774) Interest Received 1,300,902 685,276 Net movement in advances given to Subsidiary Companies 637,854 730,804 Purchase of Fixed Deposits (with maturity more than three months) (14,915,200) - Proceeds from Maturity of Fixed Deposits (with maturity more than three months) 300,000 500,000 Acquisition/Subscription/Investment in Subsidiaries/Associate (Refer note 5 below) (181,518) (4,386,123) Net cash used in investing activities (108,943,752) (115,984,122)

5 Airtel main 98-148.p65 100 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 .AdvancesgiventoSubsidiaryCompanieshavebeenreportednetbasis. 6. Duringtheyear,CompanyincreaseditsstakeinBhartiHexacomLimitedby1.11%throughacquisitionof27,80,306 equitys 5. e rsatSnhlSnlBat itlManoj Kohli Ch Sunil Bharti Mittal : Date New : Place Membership No:93283 Partner per PrashantSinghal Chartered Accountants For S.R.BATLIBOI&ASSOCIATES As perourreportofevendate Thefollowing assetsandliabilitiesacquiredundertheschemeofamalgamationhavenotbeenconsideredinaboveCashflo 4. CashandcashequivalentsincludesRs.18,177thousandspledgedwithvariousauthorities(March31,2008-65,884thousand 3. Previousyearfigureshavebeenregroupedandrecastwherevernecessarytoconformthecurrentclassification. 2. Figuresinbracketsindicatecashoutflow. 1. Notes : Cashflowfromfinancingactivities: C. Particulars Cash for the year endedMarch31,for the 2009 Network i2iLimitedatapurchaseconsiderationofRs.5,313,916thousand). aggregate considerationofRs.166,818thousandtherebyincreasingitsinvestmentbysameamount(PreviousYearacquisition Deferred TaxLiability Investment Current LiabilitiesandProvisions Current Assets(OtherthenCash) Cash and Bank Balances as per schedule 9 22,516,027 5,029,390 5,029,390 5,029,390 8,980,268 22,516,027 7,900,827 7,900,827 (2,405,349) (6,719,988) Cash andEquivalentsinFlowStatement: 2,867,728 Cash andBankBalancesasperschedule9 Cash andEquivalentscomprise: Cash andEquivalentsasatyearend Opening CashandEquivalents Net Increase/(Decrease)inCashandEquivalents Net cashfromfinancingactivities Proceeds fromshorttermborrowings Proceeds fromlongtermborrowings Fixed Assets(IncludingCWIPandPre-Operativeexpenditure not availableforusebytheCompany pi 9 09 he iaca fie GroupGeneralCounsel& CompanySecretary ChiefFinancialOfficer April 29,2009 (4,168, Less: -Fixeddepositsnotconsideredas Balance withScheduledBanks Cash andChequesonhand Cash andEquivalentsacquiredonam Gain /(Loss)fromswap Interest Paid Net movementincashcreditfacilitiesand Payments Receipts Issue ofSharesunderESOPScheme(includi Delhi FlowStatement 101 ragmns 216(67,648) 22,156 arrangements aheuvlnscash equivalents short termloans laain3, algamation ng shareapplica imnadMngn ietrCEO&JointManagingDirector Director Managing and airman Srikanth Balachander Vijaya Sampath Vijaya SrikanthBalachander net ofaccumulated ForandonbehalfoftheBoardDirectorsBhartiAirtelLimited in 1600193,531 176,060 tion) o h ereddFortheyearended For theyearended ercain 2 depreciation) ac 1 09March31,2008 March 31,2009 1,8,6)(19,676,837) (15,288,260) 7/21/2009, 9:23 PM 2,7,0 3,909,395 22,070,509 46520- 14,615,200 3447117,761,606 13,454,721 509307,304,605 5,029,390 (916,551) 14,622,207 (916,551) R.‘0)(Rs.‘000) (Rs. ‘000) 445,518 1,119,995 445,518 1)(3,852,591) 114) 0 130,134 709 w statement s) whichare hares foran equity in 56,208 15,414 61,599 12,353 1,876 101

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of accounts

Particulars As at As at March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 1 SHARE CAPITAL Authorised 2,500,000,000 (March 31, 2008 - 2,500,000,000) 25,000,000 25,000,000 Equity shares of Rs. 10 each

Issued, Subscribed and Paid up 1,898,239,796 of Rs. 10 each fully paid up 18,982,398 18,979,074 (March 31, 2008- 1,897,907,446 Equity Shares of Rs. 10 each) 18,982,398 18,979,074

Notes: (a) 49,999,000 and 1,516,390,970 equity shares issued as fully paid-up bonus shares on February 24, 1997 and September 30, 2001 respectively out of Share Premium account (b) 21,409,142 Equity Shares (March 31, 2008- 21,315,734) shares are allotted as fully paid up upon the conversion of Foreign Currency Convertible Bonds (FCCBs). (Refer Note 8 on Schedule 22) (c) 2,722,125 Equity Shares (March 31, 2008 - 2,722,125) shares are allotted as fully paid up under the Scheme of amalgamation without payments being received in cash. (d) For Stock options outstanding details refer note 27 on Schedule 22

SCHEDULE : 2 RESERVES AND SURPLUS Securities Premium Opening balance 39,889,844 39,259,225 Additions during the year 256,997 630,619 40,146,841 39,889,844 Revaluation reserve 21,284 21,284 Capital reserve 51,083 51,083 Reserve for Business Restructuring Opening balance 24,785,198 - Additions during the year (Refer Note 2(b) on Schedule 22) 126,831 82,181,203 Less : Transferred to Profit and Loss Account during the year - (57,396,005) [Note 2(b) of Schedule 22] 24,912,029 24,785,198

Debenture Redemption reserve Opening balance 139,958 553,581 Transferred to Profit and Loss Account during the year (4,411) (413,623) 135,547 139,958

5 Airtel main 98-148.p65 102 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 Note :Amountrepayablewithinone Other LoansandAdvances Short TermLoansandAdvances 6,000,000 Other LoansandAdvances: Debentures (Refer Note13onSchedule22) SECURED LOANS SCHEDULE :3 Profit andLossAccount General Reserve SCHEDULE :2(Cont.) Particulars oe:Aon eaal ihnoeya 149611,510 134,976 UNSECURED LOANS SCHEDULE :4 Note :Amountrepayablewithinoneyear Schedules of accounts Balance From Others From Banks From Banks (Refer Note 2(a)(i) on Schedule 22) 55,028 (265,766) 55,028 (Refer Note2(a)(i)onSchedule22) Acquired undertheschemeofAmalgamation Add :Adjustment -Vehicle Loans 103 er 5132117,581,716 25,123,211 year annexed to and forming part annexed andforming to 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 149322118,194,797 184,973,262 5,9,7 117,972,158 256,295,074 185,028,290 3,7,4 27,535,730 32,840,392 33,473,546 36,901,853 6691765,179,172 76,619,167 623784,803,050 6,243,768 R.‘0)(Rs.‘000) (Rs. ‘000) 1,0 517,304 0,0 500,000 500,000 1,0 24,244 17,304 sa Asat As at - 43,127 - 182,859,525 524,244 - 103

BHARTI AIRTEL ANNUAL REPORT 2008-09 5 Airtelmain 98-148.p65

SCHEDULE 5 : FIXED ASSETS (Refer Notes 3, 4, 15, 16 on Schedule 21 and Note 2(b), 21, 24 & 25 on Schedule 22) (Rs. ‘000)

Gross Block Value Depreciation/ Amortisation Net Block Value PARTICULARS As at Acquired Additions Sale / As at As at Acquired For the Sale / As at As at As at April 01, under the during Adjustment March 31, April 01, under year Adjustment March 31, March 31, March 31, 2008 scheme of the year during 2009 2008 the scheme during 2009 2009 2008 merger the year of merger the year 104 INTANGIBLE ASSETS Software 83,993 - - - 83,993 83,993 - - - 83,993 - - Bandwidth 10,781,877 - 3,723,495 3,756,816 10,748,556 1,123,106 - 605,787 2,622 1,726,271 9,022,285 9,658,771 Licences 21,141,521 - - - 21,141,521 9,329,915 - 1,141,184 - 10,471,099 10,670,422 11,811,606

TANGIBLE ASSETS Leasehold Land 62,696 - 195,252 9,483 248,465 4,002 - 2,122 657 5,467 242,998 58,694 Freehold Land 454,182 89,282 132,028 399 675,093 - - - - - 675,093 454,182 Building 2,759,907 79,083 675,017 3,878 3,510,129 563,511 26,421 141,368 760 730,540 2,779,589 2,196,396 Leasehold Improvements 2,429,715 - 408,508 87,086 2,751,137 875,258 - 347,332 34,964 1,187,626 1,563,511 1,554,457 Plant and Machinery 224,319,664 100,588 84,574,033 (815,015) 309,809,300 65,691,620 33,695 27,093,604 1,291,062 91,527,857 218,281,443 158,628,044 Computers 16,517,257 547 4,319,464 210,484 20,626,784 11,643,499 547 3,429,740 178,415 14,895,371 5,731,413 4,873,758 Office Equipment 1,522,332 4,250 427,245 59,797 1,894,030 905,892 1,495 279,052 55,209 1,131,230 762,800 616,440 Furniture and Fixture 895,479 135 90,561 11,114 975,061 547,713 134 126,185 6,275 667,757 307,304 347,766 Vehicles 184,496 - 36,277 21,216 199,557 81,504 - 37,499 12,955 106,048 93,509 102,992 Vehicle on Finance Lease 3,397 - - - 3,397 28 - 151 - 179 3,218 3,369 TOTAL 281,156,516 273,885 94,581,880 3,345,258 372,667,023 90,850,041 62,292 33,204,024 1,582,919 122,533,438 250,133,585 190,306,475 Capital Work in Progress 25,666,693 27,510,788 GRAND TOTAL 281,156,516 273,885 94,581,880 3,345,258 372,667,023 90,850,041 62,292 33,204,024 1,582,919 122,533,438 275,800,278 217,817,263 Previous Year 265,099,314 563,376 97,089,308 81,595,482 281,156,516 72,042,973 416,822 32,861,550 14,471,304 90,850,041

Notes: 7/21/2009, 9:23 PM 1. Capital Work in Progress includes Capital advances of Rs. 1,555,709 thousand (Previous year Rs. 3,623,815 thousand) 2. Addition to fixed assets during the year includes : Rs. Nil (Previous year Gain of Rs. 1,641,579 thousand) on account of fluctuations in foreign exchange rates 3. Capital work in Progress as on March 31, 2009 is net of Rs. Nil (Previous year includes Rs. 1,837 thousand gain) on account of fluctuation in Exchange rate 4. Freehold Land and Building includes Rs. 13,135 thousand (Previous year Rs. 26,468 thousand) and Rs. 297,301 thousand (previous year Rs. 71,477 thousand) respectively, in respect of which registration of title in favour of the Company is pending 5. Building includes building on leasehold land Rs. 59,439 thousand (March 31, 2008 Rs. Nil) 6. The remaining amortisation period of licence fees as at March 31, 2009 ranges between 6 to 16 years for Unified Access Service Licences and 13 years for Long Distance Licences 7. Capital work in progress includes goods in transit Rs. 2,069,495 thousand (Previous year Rs. 2,887,441 thousand) 8. Computers include Gross Block of assets capitalised under finance lease Rs. 12,165,684 thousand (Previous year Rs. 7,993,424 thousand) and corresponding Accumulated Depreciation being Rs. 7,173,057 thousand (Previous year Rs. 4,571,055 thousand) 9. Sale/Adjustment during the year includes reclassification of class of assets 5 Airtelmain 98-148.p65 Long term,otherthantrade,Unquoted Current, otherthantrade,Quoted Current, otherthantrade,Unquoted (Refer Note7onSchedule21and2022) INVESTMENTS SCHEDULE :6 Particulars Long Term:Trade(Unquoted) Schedules of accounts oenetscrte 1851,839 1,835 27,069 15,705,261 18,792,006 1,757,384 - Governmentsecurities - MutualFundsandBonds - DepositsandBonds 3 BhartiAirtelHoldings(Singapore) PteLimited:1(Previousyear1) 13) BhartiAirtelLanka(Private)Limited: 525,596,420 12) Bharti TelemediaLimited:4,080,000(Previousyear4,080,000) 11) BhartiInfratelLimited: 500,000,000(Previousyear50,000) 10) Networki2iLimited: 9,000,000(Previousyear9,000,000) 9) BhartiAirtel(Singapore)PrivateLimited:7,50,001 (Previousyear100) 8) Bharti Airtel(Canada)Limited:100(Previousyear100) 7) BhartiAirtel(Hongkong)Limited:4,959,480(Previousyear1) 6) BhartiAirtel(UK)Limited:123,663(Previousyear1) 5 Bharti Airtel(USA)Limited:300(Previousyear200) 4) BhartiAquanetLimited:Nil(Previousyear2,500,000) 3) BhartiAirtelServicesLimited:100,000(Previousyear100,000) 2) BhartiHexacomLimited:174,999,980(Previousyear166,501,980) 1) Investment inSubsidiaries RfrNt ()o ceue2) ,4,1 - 2,049,411 40,902 40,902 82,181,703 5,316,039 82,181,703 5,316,039 26,333 4 Dollar(SGD)1 Equity sharesofSingapore 261,549 20,139 (Refer Note2(f)onSchedule 22) 87,609 (Previous year100)Equityshares ofSLR10eachfullypaidup 26,333 - Equity sharesofRs10eachfullypaidup. 4 20,139 100,612 508,971 Equity sharesofRs.10eachfullypaidup.* 1,000 Equity sharesofUSD1eachfullypaidup. 508,971 Equity sharesofSingaporeDollar(SGD)1eachfullypaid up. 5,207,748 1,000 Equity sharesofCanadianDollar(CAD)1eachfullypaidup. 5,717,628 Equity sharesofHKD1eachfullypaidup Equity sharesofGBP1eachfullypaidup* Equity sharesofUSD.0001eachfullypaidup. (Refer Note2(a)onSchedule22) Equity sharesofRs.10eachfullypaidup Equity sharesofRs.10eachfullypaidup. (Refer Note2(d)&(e)onSchedule22) Equity sharesofRs.10eachfullypaidup 105 annexed to and forming part annexed andforming to ahflypi p ,0,5 - 1,106,553 each fullypaidup 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 0512520,551,225 R.‘0)(Rs.‘000) (Rs. ‘000) sa Asat As at 15,734,169 105

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of accounts

Particulars As at As at March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 6 (Cont.)

Investment in Joint Ventures 1) Bridge Mobile PTE Limited: 2,200,000 (Previous year 2,200,000) Equity shares of USD 1 each fully paid up. 92,237 92,237

Investment in Assosiates 1) Bharti Teleports Limited: 1,470,000 (Previous year Nil) Equity shares of Rs. 10 each fully paid up. (Refer Note 2(g) on Schedule 22) 14,700 -

Others 1) IFFCO Kissan Sanchar Limited : 100,000 (Previous Year 100,000) Equity Shares 50,125 50,125 97,226,357 93,794,359 117,777,582 109,528,528 (*Refer Note 20(b) on Schedule 22) Aggregate Market Value of Quoted Investments 18,877,621 15,742,896 Aggregate amount of Quoted Investments 18,792,006 15,732,330 Aggregate amount of Unquoted Investments 98,985,576 93,796,198

SCHEDULE : 7 INVENTORY (Refer Note 6 on Schedule 21) Stock-In-Trade * 621,510 568,607

621,510 568,607

* Net of Provision for diminution in value Rs. 20,827 thousand (March 31, 2008 Rs. 41,893 thousand)

5 Airtel main 98-148.p65 106 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 atclr sa As at As at Other debts Debts outstandingforaperiodexceedingsixmonths (Unsecured, consideredgoodunlessotherwisestated) (Refer Note5onSchedule21) SUNDRY DEBTORS SCHEDULE :8 Particulars CASH ANDBANKBALANCES SCHEDULE :9 OTHER CURRENTASSETS SCHEDULE :10 *[IncludesRs.14,208thousandpledgedwithvarious Schedules of accounts cniee od25,974,616 (1,686,281) 24,473,108 (2,000,235) 1,789,956 (Also refernote23onSchedule22) Rs. 767,574thousand) (5,074,794) section 370(1B)Rs.Nil(March31,2008 1,027,380 same managementwithinthemeaningof (7,198,205) Debts duefromothercompaniesunderthe Less :Provisionfordoubtfuldebts -considered doubtfu -considered good Less :Provisionfordoubtfuldebts -considered doubtfu -considered good Cash in Hand 23,382 74,872 1,045,123 23,382 422,136 Balances withScheduledBanks Cheques inHand Cash inHand neetAcudo netet 0,3 19,399 207,635 Unamortised upfrontfeesandDeferred Interest AccruedonInvestment authorities (March31,2008Rs.61,288thousand)] - in Current Account 1,088,926 888,557 1,088,926 - inFixeddeposits - inCurrentAccount nDpstAcuta agnMny3994,556 3,969 - inDepositAccountasMarginMoney 107 2,000,235 7,198,205 l l 20,977,614 * annexed to and forming part annexed andforming to rmu 9942977,870 989,492 Premium 24,473,108 1,027,380 ac 1 09March31,2008 March 31,2009 5504827,764,572 25,500,488 2560722,516,027 1,197,1 R.‘0)(Rs.‘000) (Rs. ‘000) 7/21/2009, 9:23 PM 7997,269 27 25,974,616 1,686,281 5,074,794 1,789,956 3,016,282 5,029,390 107

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of accounts

Particulars As at As at March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 11 LOANS AND ADVANCES (Unsecured, considered good unless otherwise stated) Advances Recoverable in cash or in kind or for value to be received*

Considered good 41,539,755 27,527,205 Considered doubtful 4,438,434 4,191,441 Less: Provision (4,438,434) 41,539,755 (4,191,441) 27,527,205 Advance to ESOP Trust 105,489 116,971 Advance Tax [Net of provision for tax Rs. 26,209,322 thousand (March 31, 2008 17,018,162 thousand)] 894,226 119,902 Advance Wealth Tax [Net of Provision for tax Rs. 840 thousand (March 31, 2008 Rs. 608 thousand)] 694 154 Advance Fringe Benefit Tax [Net of provision for tax Rs. 869,615 thousand (March 31, 2008 Rs. 502,607 thousand)] 49,655 45,767 MAT Credit 1,825,128 428,824 44,414,947 28,238,823 Debts due from other companies under the same management within the meaning of section 370(1B) Rs. 13,448,301 thousand (March 31, 2008 Rs. 4,297,830 thousand) (Also refer note 23 on Schedule 22)

SCHEDULE : 12 CURRENT LIABILITIES AND PROVISIONS Current Liabilities Sundry Creditors : Total outstanding dues of Micro and Small Enterprises* 44,258 - Total outstanding dues of Creditors other than Micro and Small Enterprises** 91,508,638 91,552,896 83,816,886 83,816,886 Advance Billing and Prepaid Card Revenue 31,299,451 26,853,515 Interest accrued but not due on loans 840,186 732,681 Other Liabilities 3,429,190 3,541,797 Advance Received from customers 633,162 667,121 Security Deposits (Refer Note 9 on Schedule 22) 3,424,931 3,478,690 131,179,816 119,090,690 *Refer Note 18 on Schedule 22 ** Amount repayable to Subsidiary Companies Rs. 2,640,272 thousand (Previous year Nil)

5 Airtel main 98-148.p65 108 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 SCHEDULE :12(Cont.) Premium onRedemptionofDebentures As at ** NetofstockcompensationincomeRs.3,682thousand RelatingtoEmployeeStockOptionScheme2001and2004 * Deferred EmployeeCompensationExpense* As at (Refer Note14onSchedule21and2722) (To theextentnotwrittenofforadjusted) MISCELLANEOUS EXPENDITURE SCHEDULE :13 Provisions Particulars Schedules of accounts a nDvdn 6522- 645,212 - 3,796,480 Tax onDividend Proposed Dividend(ReferNote31onSchedule22) pnn aac 20426,630 4,378 20,218 - 2,034 573 588 (6,594) - (6,594) (1,351) Less :Amortisationfortheyear Less :Writebackduringtheyear (1,351) Opening Balance (March 31,2008Rs.3,886thousand) 380,373 Less: Amortisationfortheyear** Add: Addition/(Adjustments)duringtheyear Balance Opening 582,275 Others (ReferNote6(i)and21 Note 6onSchedule Leave Encashment(ReferNote10onSchedule21and Note 6onSchedule22) Gratuity (ReferNote10onSchedule21and 109 2 22) on Schedule22) annexed to and forming part annexed andforming to ac 1 09March31,2008 March 31,2009 3,2,2 121,189,452 137,523,820 ,4,0 2,098,762 6,344,004 R.‘0)(Rs.‘000) (Rs. ‘000) 842,403 7/21/2009, 9:23 PM 7,3 464,676 477,634 7 2,034 873 -- 1,253,713 109

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of accounts

Particulars For the For the year ended year ended March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 14 NETWORK OPERATING EXPENDITURE Interconnect charges and PSTN rentals 864,335 891,747 Installation 42,549 86,131 Power and Fuel 16,125,827 9,857,737 Rent 28,747,906 8,102,162 Insurance 124,567 106,127 Repairs and Maintenance - Plant and Machinery 7,703,525 7,080,594 - Others 159,285 932,019 Leased Line and Gateway charges 1,213,649 647,260 Internet access and bandwidth charges 2,393,706 2,353,998 Others 5,893,572 2,946,971 63,268,921 33,004,746

SCHEDULE : 15 COST OF GOODS SOLD Opening Stock 568,607 478,145 Add : Purchases 2,869,427 2,353,696 Less : Simcard Utilisation 1,618,471 800,728 Less : Internal issues/capitalised 1,074,002 1,124,004 Less : Closing Stock * 621,510 568,607 124,051 338,502

* Net of Provision for diminution in value Rs. 20,827 thousand (March 31, 2008 Rs. 41,893 thousand)

5 Airtel main 98-148.p65 110 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 Loss on sale of assets (net) - 32,075 2,812,103 1,958,584 30,824 - 1,343,829 539,555 593,931 38,319 97,779 1,030,744 756,695 1,172,833 656,224 228,944 1,708,114 7,636,595 596,648 107,561 942,806 2,684,358 106,231 800,728 746,185 10,943,342 7,589,808 Miscellaneous Expenses Loss onsaleofassets(net) 6,476,102 5,664,692 Collection andRecoveryExpenses 1,618,471 Provision forDiminutioninStock Provision fordoubtfuldebtsandadvances 619,846 Bad debtswrittenoff Insurance 363,096 Repairs andMaintenance-Building 6,326,848 6,228,864 Rent Traveling andConveyance IT andCallCenterOutsourcing Power andFuel 584,949 Rates andTaxes Legal andProfessional 11,942,494 ADMINISTRATIVE ANDOTHEREXPENDITURE 360,982 416,416 SCHEDULE :18 Others 12,959,548 Sim cardutilisation Sales CommissionandIncentive 430,928 Advertisement andMarketing SALES ANDMARKETINGEXPENDITURE SCHEDULE :17 Refer Note27(vii)onSchedule22 * ExcludingamortisationofDeferredESOPcost Recruitment andTraining Welfare Staff Contribution toProvidentandOtherFunds Salaries, WagesandBonus* (Refer Note10onSchedule21and622) PERSONNEL EXPENDITURE SCHEDULE :16 Particulars Schedules of accounts 111 tes 9,9 583,725 398,890 - Others annexed to and forming part annexed andforming to ac 1 09March31,2008 March 31,2009 0853820,875,328 21,763,991 14,336,407 ereddyearended year ended ,8,0 1,145,635 1,087,509 R.‘0)(Rs.‘000) (Rs. ‘000) 7/21/2009, 9:23 PM 84010,122 28,490 o h Forthe For the 19,143,322 18,135,257 13,341,852 5,193,735 111

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of accounts

Particulars For the For the year ended year ended March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 19 OTHER INCOME Liabilities/Provisions no longer required written back 497,718 352,497 Profit on Sale of Assets (Net) 38,899 - Miscellaneous 870,751 2,006,084 1,407,368 2,358,581

SCHEDULE : 20 FINANCE EXPENSE/(INCOME) (Net) Interest : - On Term Loan 2,010,561 1,948,841 - On Debentures 58,457 68,341 - On Others 35,189 60,595 Amortisation of Premium on Redemption of FCCB’s 573 4,378 Exchange fluctuation (gain)/loss (Net) 17,142,195 2,143,277 Loss from swap arrangements 65,433 97,562 Other Finance Charges 2,171,412 1,754,579 21,483,820 6,077,573 Less : Income Profit on sale of Current Investments (other than trade) 2,354,840 577,505 Interest Income : - from Current Investments and Fixed Deposits (Other than Trade) [Gross of TDS of Rs. 132,610 thousand (March 31, 2008 Rs. 34,647 thousand)] 739,406 171,631 - from other advances 749,732 491,357 [Gross of TDS of Rs. 171,212 thousand (March 31, 2008 Rs. 108,538 thousand)] 3,843,978 1,240,493 17,639,842 4,837,080

5 Airtel main 98-148.p65 112 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 .DEPRECIATION/AMORTISATION 4. FIXEDASSETS 3. USEOFESTIMATES 2. BASISOFPREPARATION 1. MARCH 31,2009 STATEMENT OFSIGNIFICANTACCOUNTINGPOLICIESTOTHEFINANCIALSTATEMENTSFORYEARENDED SCHEDULE: 21 Schedules of accounts eils5 5years/2years 5 years 20 years operations. 3 is beingamortisedequallyover thebalanceperiodoflicencefromdatecommencement ofcommercial 3years to20years The EntryFeecapitalisedis being amortisedequallyovertheperiodoflicenseand theonetimelicencefee of 18years. Periodoflease Period ofleaseor10yearswhicheverisless Bandwidth capacityisamortised onstraightlinebasisovertheperiodofagreement subjecttoamaximum 20years Software uptoRs.500thousandiswrittenoffinthefinancial yearplacedinservice. Vehicles Furniture andFixtures Equipment Office Computer/Software Machinery and Plant Improvements Leasehold Building onLeasedLand Building Land Leasehold higher, asfollows: useful livesofassets;orattheratesprescribedunderscheduleXIVCompaniesAct,1956,whicheveris Depreciation isprovidedonstraight-linemethod,attheratesdeterminedbasedestimatedeconomic and internationallongdistanceservices)hasbeencapitalisedasanintangibleasset. license feepaidbytheCompanyforacquiringnewlicences(postNTP-99)(basic,cellular,nationallongdistance to theNationalTelecomPolicy(NTP1999),i.e.EntryFee,hasbeencapitalisedasanassetandonetime The intangiblecomponentoflicensefeepayablebytheCompanyforcellularandbasiccircles,uponmigration to settletheobligationandareliableestimateofamountcanbemade. Site restorationcostobligationsarecapitalizedwhenitisprobablethatanoutflowofresourceswillberequired in-progress isstatedatcost. (net ofcenvatcredit),freightandotherincidentalexpensesrelatedtoacquisitioninstallation.Capitalwork- Fixed Assetsarestatedatcostofacquisitionandsubsequentimprovementsthereto,includingtaxesduties and actions,actualresultscoulddifferfromtheseestimates. reporting yearend.Althoughtheseestimatesarebaseduponmanagement’sbestknowledgeofcurrentevents disclosure ofcontingentliabilitiesatthedatefinancialstatementsandresultsoperationsduring management tomakeestimatesandassumptionsthataffectthereportedamountsofassetsliabilities The preparationoffinancialstatementsinconformitywithgenerallyacceptedaccountingprinciplesrequires below, areconsistentwiththoseusedinthepreviousyear. consistently appliedbytheCompanyand,exceptforchangesinaccountingpolicydiscussedNote9 an accrualbasisexceptincaseofassetsforwhichrevaluationiscarriedout.Theaccountingpolicieshavebeen the CompaniesAct,1956.Thefinancialstatementshavebeenpreparedunderhistoricalcostconventionon Standards byCompanies(AccountingStandards)Rules,2006,(‘asamended’)andtherelevantprovisionsof The financialstatementshavebeenpreparedtocomplyinallmaterialrespectswiththeNotifiedAccounting 113 annexed to and forming part annexed andforming to Useful lives years years 7/21/2009, 9:23 PM 113

BHARTI AIRTEL ANNUAL REPORT 2008-09 The site restoration cost obligation capitalized is depreciated over the period of the useful life of the related asset. Fixed Assets costing upto Rs 5 thousand are being fully depreciated within one year from the date of acquisition. 5. REVENUE RECOGNITION AND RECEIVABLES Mobile Services Service revenue is recognised on completion of provision of services. Service revenue includes income on roaming commission and access charges passed on to other operators, and is net of discounts and waivers. Revenue, net of discount, is recognised on transfer of all significant risks and rewards to the customer and when no significant uncertainty exists regarding realisation of consideration. Processing fees on recharge is being recognised over the estimated customer relationship period or voucher validity period, as applicable. Telemedia Services (Erstwhile Broadband & Telephone Services) and Enterprise Services Carriers Service revenue is recognised on completion of provision of services. Revenue on account of bandwidth service is recognised on time proportion basis in accordance with the related contracts. Service Revenue includes access charges passed on to other operators, and is net of discounts and waivers. Revenue, net of discount, from sale of goods is recognised on transfer of all significant risks and rewards to the customer and when no significant uncertainty exists regarding realisation of consideration. Revenue from prepaid calling cards packs is recognised on the actual usage basis. Enterprise Services Corporate Revenue, net of discount, from sale of goods is recognised on transfer of all significant risks and rewards to the customer and when no significant uncertainty exists regarding realisation of consideration. Service Revenues includes revenues from registration, installation and provision of Internet and Satellite services. Registration fees is recognised at the time of dispatch and invoicing of Start up Kits. Installation charges are recognised as revenue on satisfactory completion of installation of hardware and service revenue is recognised from the date of satisfactory installation of equipment and software at the customer site and provisioning of Internet and Satellite services. Activation Income Activation revenue and related direct activation costs, not exceeding the activation revenue, are deferred and amortized over the related estimated customers relationship period, as derived from the estimated customer churn period. Investing and other Activities Income on account of interest and other activities are recognised on an accrual basis. Dividends are accounted for when the right to receive the payment is established. Provision for doubtful debts The Company provides for amounts outstanding for more than 90 days in case of active subscribers and for entire outstanding from deactivated customers net off security deposits or in specific cases where management is of the view that the amounts from certain customers are not recoverable. For receivables due from the other operators on account of their NLD and ILD traffic, IUC and roaming charges, the Company provides for amounts outstanding for more than 120 days from the date of billing, net of any amounts payable to the operators or in specific cases where management is of the view that the amounts from these operators are not recoverable. Accrued Billing revenue Accrued billing revenue represent revenue recognized in respect of Mobile, Broadband and Telephone, and Long Distance services provided from the bill cycle date to the end of each month. These are billed in subsequent periods as per the terms of the billing plans. 6. INVENTORY Inventory is valued at the lower of cost and net realisable value. Cost is determined on First in First out basis. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale.

5 Airtel main 98-148.p65 114 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 9. FOREIGN CURRENCY TRANSLATION, ACCOUNTING FOR FORWARD CONTRACTS AND DERIVATIVES FOREIGNCURRENCYTRANSLATION,ACCOUNTINGFORFORWARDCONTRACTS 9. LICENSEFEES–REVENUESHARE 8. INVESTMENT 7. The Company occasionally entersintocontracts thatdonotintheirentirety meetthedefinitionof aderivative Embedded DerivativeInstruments period/year. reduction tofairvaluesand anyreversalsofsuchreductionsareincludedinprofit and lossstatementofthe keeping inviewtheprinciple ofprudenceasenunciatedinAS1,‘Disclosure Accounting Policies’.Any contract basis.Anygainonmarked-to-marketvaluation respectivecontractsisnotrecognizedbytheCompany, on amarked-to-marketbasisandanylossvaluation isrecognisedintheprofitandlossaccount,oneach capital goodsusingforeigncurrencyloan.Ateveryyear endalloutstandingderivativecontractsarefairvalued hedge itsriskswithrespecttoforeigncurrencyfluctuations andinterestrateexposurearisingoutofimport establish theamountofreportingcurrencyrequired or availableatthesettlementdateofatransaction;to in thenatureofforwardcontractsdesignatedunderAS 11assuchandcontractsthatarenotenteredto The Companyentersintovariousforeigncurrencyoption contractsandinterestrateswapthatarenot Other DerivativeInstruments,notinthenatureofAS11, ‘TheEffectsofChangesinForeignExchangeRates’ contract foranearlierperiod)arerecognisedintheprofit andlossaccountfortheperiod/year. maturity periodandthecontractedforwardrate(or forward ratelastusedtomeasureagainorlossonthe currency arisingduetothedifferencebetweenforwardrateavailableatreportingdateforremaining Exchange differenceonforwardcontractswhicharetakentoestablishtheamountotherthanreporting expense fortheperiod/year. profit orlossarisingoncancellationrenewalofsuchforwardexchangecontractisrecognisedasincome inception offorwardexchangecontractsisamortisedasexpenseorincomeoverthelifecontract.Any & LossAccountintheyearwhichexchangeratechanges.Thepremiumordiscountarisingat amount ofreportingcurrencyandnotintendedfortradingspeculationpurposes,arerecognisedintheProfit Exchange differencesonforwardexchangecontractsandplainvanillacurrencyoptionsforestablishingthe Forward ExchangeContractscoveredunderAS11,‘TheEffectsofChangesinForeignRates’ from adjustingsuchexchangedifferencesinthecarryingcostofrespectiveassets. fluctuations inrespectofloans/liabilitiesforacquisitionfixedassetsdirectlytotheProfit&LossAccount During theyear,Companyhas,witheffectfromApril1,2008,changeditspolicytocharge/credit mentioned below. previous financialstatements,arerecognizedasincomeorexpensesintheperiod/yearwhichtheyarise items atratesdifferentfromthosewhichtheywereinitiallyrecordedduringtheperiod/year,orreportedin Exchange differencesarisingonthesettlementofmonetaryitemsorrestatementCompany’s Exchange Differences in aforeigncurrencyarereportedusingtheexchangeratesthatexistedwhenvaluesweredetermined. the transaction;andnon-monetaryitemswhicharecarriedatfairvalueorothersimilarvaluationdenominated terms ofhistoricalcostdenominatedinaforeigncurrencyarereportedusingtheexchangerateatdate Foreign currencymonetaryitemsarereportedusingtheclosingrate.Non-monetarywhichcarriedin Conversion the exchangeratebetweenreportingcurrencyandforeignatdateoftransaction. Foreign currencytransactionsarerecordedinthereportingcurrency,byapplyingtoforeignamount Initial Recognition this purposeidentifiedasadjustedgrossrevenuepertherespectivelicenseagreements. charged totheProfitandLossAccountinyearwhichrelatedrevenuesarerecognised.Revenuefor With effectfromAugust1,1999,thevariableLicencefeecomputedatprescribedratesofrevenueshareis any, otherthanthatoftemporarynature. Long termInvestmentsarevaluedatcost.Provisionismadefordiminutioninvaluetorecogniseadecline,if Current Investmentsarevaluedatlowerofcostandfairmarketvaluedeterminedonindividualbasis. of inventory. The Companyprovidesforobsoleteandslow-movinginventorybasedonmanagementestimatesoftheusability 115 7/21/2009, 9:23 PM 115

BHARTI AIRTEL ANNUAL REPORT 2008-09 instrument that may contain “embedded” derivative instruments – implicit or explicit terms that affect some or all of the cash flow or the value of other exchanges required by the contract in a manner similar to a derivative instrument. The Company assesses whether the economic characteristics and risks of the embedded derivative are clearly and closely related to the economic characteristics and risks of the remaining component of the host contract and whether a separate, non-embedded instrument with the same terms as the embedded instrument would meet the definition of a derivative instrument. When it is determined that (1) the embedded derivative possesses economic characteristics and risks that are not clearly and closely related to the economic characteristics and risks of the host contract and (2) a separate, stand-alone instrument with the same terms would qualify as a derivative instrument, the embedded derivative is separated from the host contract, carried at fair value as a trading or non-hedging derivative instrument. The loss on marked-to-market valuation of the embedded derivative instrument is recognized in the Profit & Loss Account for the period/year. Any reduction in mark to market valuations and reversals of such reductions are included in profit and loss statement of the period/year. Translation of Integral and Non-Integral Foreign Operation The financial statements of an integral foreign operation are translated as if the transactions of the foreign operation have been those of the Group itself. In translating the financial statements of a non-integral foreign operation for incorporation in financial statements, the assets and liabilities, both monetary and non-monetary are translated at the closing rate; income and expense items are translated at exchange rate at the date of transaction for the year; and all resulting exchange differences are accumulated in a foreign currency translation reserve until the disposal of the net investment. Foreign exchange contracts for trading and speculation purpose Foreign exchange contracts intended for trading and/or speculation are fair valued on a marked-to-market basis and any loss on such valuation is recognised in the Profit & Loss Account for the period. 10. EMPLOYEE BENEFITS (a) Short term employee benefits are recognised in the period during which the services have been rendered. (b) All employees of the Company are entitled to receive benefits under the Provident Fund, which is a defined contribution plan. Both the employee and the employer make monthly contributions to the plan at a predetermined rate (presently 12%) of the employees’ basic salary. These contributions are made to the fund administered and managed by the Government of India. In addition, some employees of the Company are covered under the employees’ state insurance schemes, which are also defined contribution schemes recognized and administered by the Government of India. The Company’s contributions to both these schemes are expensed in the Profit and Loss Account. The Company has no further obligations under these plans beyond its monthly contributions. (c) Some employees of the Company are entitled to superannuation, a defined contribution plan which is administered through Life Insurance Corporation of India (“LIC”). Superannuation benefits are recorded as an expense as incurred. (d) Short term compensated absences are provided for based on estimates. Long term compensated absences are provided for based on actuarial valuation. The actuarial valuation is done as per projected unit credit method. (e) The Company provides for gratuity obligations through a defined benefit retirement plan (the ‘Gratuity Plan’) covering all employees. The Gratuity Plan provides a lump sum payment to vested employees at retirement or termination of employment based on the respective employee salary and years of employment with the Company. The Company provides for the Gratuity Plan based on actuarial valuations as per the Projected Unit Credit Method at the end of each financial year in accordance with Accounting Standard 15 (revised), “Employee Benefits”. The Company makes annual contributions to the LIC for the Gratuity Plan in respect of employees at certain circles. (f) Other Long term service benefits are provided based on actuarial valuation made at the end of each financial year. The actuarial valuation is done as per projected unit credit method. (g) Actuarial gains and losses are recognized as and when incurred. 11. PRE-OPERATIVE EXPENDITURE Expenditure incurred by the Company from the date of acquisition of license for a new circle or from the date of start-up of new ventures or business, up to the date of commencement of commercial operations of the circle or the new venture or business, not directly attributable to fixed assets are charged to the Profit & Loss account in the year in which such expenditure is incurred.

5 Airtel main 98-148.p65 116 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 6 IMPAIRMENTOFASSETS 16. BORROWINGCOST 15. MISCELLANEOUSEXPENDITURE 14. TAXATION 13. LEASES 12. The carryingamounts ofassetsarereviewed ateachbalancesheet date forimpairmentwhenever eventsor recognised asanexpensein theyearinwhichtheyareincurred. time togetreadyforitsintended useiscapitalisedaspartofthecostthatasset. Otherborrowingcostsare Borrowing costattributable to theacquisitionorconstructionoffixedassetswhich takes substantialperiodof period oftherelatedcontract. Premium onredemptionofdebenturesisrecognisedas anexpensetotheProfitandLossAccountover effect thatCompanywillpaynormalIncomeTaxduring thespecifiedperiod. down thecarryingamountofMATCreditEntitlementto the extentthereisnolongerconvincingevidenceto and shownasMATCreditEntitlement.TheCompanyreviews thesameateachbalancesheetdateandwrites in GuidanceNoteissuedbytheICAI,saidassetiscreated bywayofacredittotheProfitandLossAccount the MATcreditbecomeseligibletoberecognizedasanasset inaccordancewiththerecommendationscontained evidence thattheCompanywillpaynormalincometaxduringspecifiedperiod.Inperiod/yearinwhich Minimum AlternativeTax(MAT)creditisrecognisedasanassetonlywhenandtotheextentthereconvincing income willbeavailableagainstwhichsuchdeferredtaxassetscanrealized. years arere-assessedandrecognisedtotheextentthatithasbecomereasonablycertainfuturetaxable realised againstfuturetaxableprofits.Ateachbalancesheetdate,unrecogniseddeferredtaxassetsofearlier tax assetsarerecognisedonlyifthereisvirtualcertaintysupportedbyconvincingevidencethattheycanbe realised. Insituationswherethecompanyhasunabsorbeddepreciationorcarryforwardtaxlosses,alldeferred certainty thatsufficientfuturetaxableincomewillbeavailableagainstwhichsuchdeferredtaxassetscan tax assetsarerecognisedandreviewedateachbalancesheetdate,onlytotheextentthatthereisreasonable based onthetaxratesandlawsenactedorsubstantivelyatbalancesheetdate.Deferred accounting incomefortheyearandreversaloftimingdifferencesearlieryears.Deferredtaxismeasured Deferred incometaxesreflectstheimpactofcurrentyeartimingdifferencesbetweentaxableand in accordancewithIndianIncomeTaxAct,1961. Current Incometaxandfringebenefitismeasuredattheamountexpectedtobepaidauthorities InitialdirectcostsareexpensedintheProfit&LossAccountatinceptionoflease. c) WheretheCompanyislessor b) WheretheCompanyislessee a) investment ofthelessoroutstandinginrespectlease. Finance Incomeisrecognizedbasedonapatternreflectingconstantperiodicrateofreturnthenet treated asotheroutrightsales. Finance leasesasadealerlessorarerecognizedsaletransactionintheProfit&LossAccountand basis overtheleaseterm. Lease incomeinrespectof‘OperatingLease’isrecognisedtheProfit&LossAccountonastraight-line rate ofinterestontheremainingbalanceliability. of returnmethod.Thefinancechargeisallocatedovertheleasetermsoastoproduceaconstantperiodic the assets.Leaserentalpayableisapportionedbetweenprincipalandfinancechargeusinginternalrate Amortization ofcapitalisedleasedassetsiscomputedontheStraightLinemethodoverusefullife applicable, estimatedfairvalueofsuchassets. lower offairvaluetheleasedpropertyorpresentminimumleasepaymentswhere transfer riskandrewardsofownershiptotheCompanyarecapitalizedasassetsbyat ownership oftheleaseditemareclassifiedasfinancelease.Assetsacquiredon‘FinanceLease’which Leases whicheffectivelytransfertotheCompanysubstantiallyallrisksandbenefitsincidental Lease’ arechargedtotheProfit&LossAccountonastraight-linebasisoverleaseterm. leased term,areclassifiedasoperatingleases.LeaseRentalswithrespecttoassetstakenon‘Operating Leases wherethelessoreffectivelyretainssubstantiallyallrisksandbenefitsofownership 117 7/21/2009, 9:23 PM 117

BHARTI AIRTEL ANNUAL REPORT 2008-09 changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognized for the amount by which the assets’ carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the assets’ fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash generating units). 17. SEGMENTAL REPORTING a) Primary Segment The Company operates in four primary business segments viz. Mobile Services, Telemedia Services, Enterprise Services Carriers and Enterprise Services Corporate. b) Secondary Segment The Company has operations within India as well as in other countries through entities located outside India. The operations in India constitute the major part, which is the only reportable segment, the remaining portion being attributable to others. 18. EARNINGS PER SHARE The earnings considered in ascertaining the Company’s Earnings per Share (‘EPS’) comprise the net profit after tax. The number of shares used in computing basic EPS is the weighted average number of shares outstanding during the period. The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares unless impact is anti dilutive. 19. WARRANTY AND ASSET RETIREMENT OBLIGATIONS (ARO) Provision for warranty and ARO is based on past experience and technical estimates. 20. PROVISIONS Provisions are recognised when the Company has a present obligation as a result of past event; it is more likely than not that an outflow of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its present value and are determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each balance sheet date and adjusted to reflect the current best estimates. 21. EMPLOYEE STOCK OPTIONS OUTSTANDING Employee Stock options outstanding are valued using Black Scholes / Lattice valuation option – pricing model and the fair value is recognised as an expense over the period in which the options vest. 22. CASH AND CASH EQUIVALENTS Cash and Cash equivalents in the Balance Sheet comprise cash in hand and at bank and short-term investments.

5 Airtel main 98-148.p65 118 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 SCHEDULE: 22 .Contingentliabilities 3. NewOperations 2. Background 1. NOTES TOTHEFINANCIALSTATEMENTSFORYEARENDEDMARCH31,2009 Schedules of accounts )TotalGuaranteesoutstandingasatMarch31,2009amountingtoRs.20,895,580 thousand(March31, a) OnMarch4,2009,theCompanysubscribedto1470,000equityshares(49%stake) inBhartiTeleports g) DuringtheyearendedMarch31,2009,CompanyinvestedRs. 2,049,411thousandinitswhollyowned f) Further, onFebruary19,2009,theCompanyincreaseditsstakeinBhartiHexacomLimitedby1.11% e) OnSeptember9,2008,BhartiAirtelLimitedsubscribedto5,717thousandrightsharesofHexacom d) DuringtheyearendedMarch31,2009,BhartiAirtelinvestedRs.1,106,553thousandsinequity sharesof c) DuringtheyearendedMarch31,2008,Companyhadtransferreditstelecominfrastructureundertaking b) DuringtheyearendedMarch31,2009,schemeofamalgamation(Scheme)forBharti a) promoted byBhartiTelecomLimited('BTL'),aCompanyincorporatedunderthelawsofIndia. Bharti AirtelLimited('BhartiAirtel'or'theCompany')incorporatedinIndiaonJuly7,1995,isaCompany behalf ofGroupCompanies. 2008 Rs.1,198,890thousand) havebeengiventobanksandfinancialinstitutionsas mentionedaboveon Corporate Guaranteesoutstanding asatMarch31,2009amountingtoRs.1,576,542 thousand(March31, Company. 2008 Rs.13,686,627thousand)havebeenissuedby banksandfinancialinstitutionsonbehalfofthe Limited foranaggregateconsiderationofRs.14,700thousand. subsidiary BhartiAirtelLanka(Private)Limitedtowards equity. through acquisitionof27,80,306equitysharesforanaggregate considerationofRs.166,818thousand. Limited foranaggregateconsiderationofRs.343,062thousand. 2009, theamountispendingallotmentbysubsidiary. its whollyownedsubsidiaryBhartiAirtelHoldingsSingaporePteLimitedtowardsequity.AsofMarch31, on theprofitsforyearendedMarch31,2009. the CompanybyRs.126,831thousandforyearendedMarch31,2009.Thisreconciliationhasnoimpact resulting intonetincreaseintheBusinessRestructuringReserve('BRR')anddecreaseliabilitiesof in/out certainassetsandaccountedtheseinaccordancewiththeaccountingprescribedScheme During theyearendedMarch31,2009,Companyhas,basedonfinalreconciliationwithBIL,transferred Company asofMarch31,2008. The reservearisingonbusinessrestructuringstandatRs.24,785,198thousandinthebalancesheetof Company hadrevalueditsinvestmentinBILandrecordeditatfairvalueofRs.82,181,203thousand. pursuant toschemesanctionedbyTheHon'bleHighCourtofDelhi,effectivefromJanuary31,2008. worth Rs.57,396,005thousandintoaseparatelegalentityBhartiInfratelLimited("BIL")atnilvalue TheCompanyhasnotissuedanysharestogiveaneffecttheabovescheme. ii) ThedifferencebetweenthecarryingvalueofInvestmentin Aquanetandvalueofnetassetsacquired i) method effectiveJanuary1,2009. Accordingly, allassetsandliabilitiesofAquanetarerecordedbytheCompanyunderpoolinginterest the RegistrarofCompanies,NationalCapitalTerrritoryDelhi&Haryana,(ROC)onJanuary1,2009. Aquanet Limited('Aquanet')withtheCompanyhasbeenapprovedbyHon'bleHighCourtandfiled under theSchemeofRs.55,028thousandhasbeencreditedtoReserveandSurplus. 119 annexed to and forming part annexed andforming to 7/21/2009, 9:23 PM 119

BHARTI AIRTEL ANNUAL REPORT 2008-09 b) Claims against the Company not acknowledged as debt (excluding cases where the possibility of any outflow in settlement is remote): (Rs. ‘000)

Particulars As at As at March 31, 2009 March 31, 2008 (i) Taxes, Duties and Other demands (under adjudication/appeal / dispute) -Sales Tax (see 3 (c) below) 399,942 333,639 -Service Tax (see 3 (d) below) 668,073 168,787 -Income Tax (see 3 (e) below) 1,977,127 1,720,888 -Customs Duty (see 3 (f) below) 2,198,348 31,194 -Stamp Duty 353,403 415,003 -Entry Tax (see 3 (g) below) 1,020,873 44,829 -Municipal Taxes 2,994 2,860 -Access Charges / Port Charges (see 3 (i) below) 2,208,917 2,239,974 -DoT demands (including 3 (h) below) 579,674 1,195,825 -Other miscellaneous demands 66,034 68,181 (ii) Claims under legal cases including arbitration matters (including 3 (j) below) 464,149 382,015

9,939,534 6,603,195 Unless otherwise stated below, the management believes that, based on legal advice, the outcome of these contingencies will be favourable and that a loss is not probable. Of the above, details of unpaid amounts relating to Income Tax, Sales Tax, Service Tax and Custom Duty together with forum where dispute is pending as at March 31, 2009 is set out below:

Name of Nature of Amount Amount Period to Forum where the Statutes the Dues Disputed Deposited which it the dispute (in Rs. ‘000) (in Rs. ‘000) Relates is pending Andhra Pradesh VAT Act Sales Tax 2,359,596 500,586 2005-08 High Court of Andhra Pradesh Gujarat Sales Tax Act Sales Tax 928 - 2006-07 Commissioner (Appeals) West Bengal Sales Tax Act Sales Tax 402 - 1996-97 DCCT - Appellate Stage West Bengal Sales Tax Act Sales Tax 14 - 1997-98 The Appelate authority UP VAT Act Sales Tax 12,178 7,194 2002-09 Assessing Officer Central Sales Tax Act Sales Tax 35,836 5,400 2003-05 Joint Commissioner Appeals UP VAT Act Sales Tax 505 136 2003-04 & Joint Commissioner Appeals 2006-07 UP VAT Act Sales Tax 7,600 3,520 2006-07 High Court of Judicature at Allahabad, Lucknow Bench UP VAT Act Sales Tax 33 29 2008-09 Assisstant Commissioner of Sales tax Haryana Sales tax Sales Tax 2,797 - 2002-04 Joint commissioner Punjab Sales Tax Act Sales Tax 611 611 2002-03 Jt. Director (Enforcement) Madhya Pradesh Sales Tax 21,720 8,621 1997-01 & Deputy Commissioner Appeals Commercial Sales Tax Act 2003-05 UP VAT Act Sales Tax 1,125 1,125 2002-05 Assistant Commissionet Karnataka Sales Tax Act Sales Tax 290,920 127,871 2005-06 JC Appeals Sub Total (A) 2,734,265 655,093 Finance Act,1994 Service Tax 371,032 - 1997-2001 Customs, Excise and Service Tax (Service Tax Provisions) & 2002-08 Appelate Tribunal Finance Act,1994 Service Tax 62,126 14,384 2002-06 Commissoner Appeals (Service Tax Provisions) Finance Act,1994 Service Tax 445 - 2004-06 Deputy Commisioner Appeals (Service Tax Provisions) Finance Act,1994 Service Tax 231,021 - 2000-01 & Supritendent of Mohali (Service Tax Provisions) 2005-08 Finance Act,1994 Service Tax 3,449 - 2006-07 Joint Commissioner of Central Excise (Service Tax Provisions) Sub Total (B) 668,073 14,384

5 Airtel main 98-148.p65 120 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 Sub Total (D) 2,198,348 57,725 2,198,348 Commi 2007-08 1,438,119 25,762 2,663,204 103,050 31,963 Custom Act 2,095,298 Custom Act Sub Total(D) Act-1962 Customs Customs Act-1962 Sub Total(C) Am D Tax Income 764,644 of Nature Tax Income Income TaxAct,1961 the Dues 2,454,836 Tax Income Income TaxAct,1961 Income TaxAct,1961 the Statutes Name of )Salestax c) )Servicetax d) )DoTDemands h) Entrytax g) Customduty f) Incometaxdemand underappeal e) ii. i. The claimsforsalestaxasofMarch31,2009comprisedthecasesrelatingto: ii. i. The servicetaxdemandsasatMarch31,2009relateto: i TheCompanyhasnotbeenabletomeet itsrolloutobligationsfullyduetocertainnon-controllable ii) TheCompanyhas receiveddemandsfromDoTpertainingtoBhartiBroadbandLimited(nowmerged i) 2009 wasRs.1,020,873thousand(March31,2008- 44,829thousand)includedinNote3(b)above. proposed tobetaxednotcoveredunderthespecificcategory. TheamountunderdisputeasatMarch31, the constitution.Classificationissueshavebeenraised whereby,inviewoftheCompany,material challenged bytheCompanyinrespectivestates,on the groundsthatspecificentrytaxis In certainstatesanentrytaxisleviedonreceiptofmaterial fromoutsidethestate.Thispositionhasbeen custom duty.Themanagementisoftheviewthatprobabilityclaimsbeingsuccessfulremote. imports shouldnotbesubjecttoanycustomdutyasitwouldanoperatingsoftwareexemptfrom part ofthehardwarealongwithwhichsamehasbeenimported.TheviewCompanyisthatsuch 31, 2008-Rs.31,194thousand)fortheimportsofspecialsoftwareongroundthatthiswouldform The customauthorities,insomestates,demandedRs.2,198,348thousandasatMarch31,2009(March and accordingly,recognitionofareserveforthosetaxpositionswillnotbeappropriate. The managementbelievesthat,basedonlegaladvice,itisprobablethatitstaxpositionswillbesustained authorities againstthedisallowanceofcertainexpensesbeingclaimedundertaxbyincomeauthorities. Income taxdemandsunderappealmainlyincludedtheappealsfiledbyCompanybeforevariousappellate the applicablesalestaxondisposalsofcertainpropertyandequipmentitems. which wasprimarilyproceduralinnature;and the appropriatenessofdeclarationsmadebyCompanyunderrelevantsalestaxlegislations subscriber receivableswrittenoff. roaming revenueschargedfromotheroperators;and The Companyisconfidentthat thisshowcausenoticewouldnotresultintoliability. has receivedshowcausenotices fromDoTfor14ofitscirclesnon-fulfillment roll outobligations. Frequency Allocationsclearance, nonavailabilityofspectrum,operationalhazards, etc. TheCompany factors likeTelecommunication EngineeringCentertesting,StandingAdvisoryCommittee ofRadio Limited hasundertakentoreimbursetheCompanyin eventoftheclaimbeingpayable. before Hon'bleTDSAT(includedinnote3(b)above). TheerstwhilepromoterofBhartiBroadband with BhartiAirtelLimited)amountingtoRs.50,563thousand againstwhichanappealhasbeenfiled 121 (in Rs ‘000) (in Rs ‘000) relates is pending is relates (inRs‘000) (in Rs‘000) 1805 174 969 I 1996-97& 91,754 108,055 100,313 581,721 1996-1997 & High Court High 1996-1997& 581,721 100,313 sue Deposited isputed utAmount ount 20-09Commissioner 2003-2009 2002-2004 2001-04 & Customs, Customs, 2001-04 & 1999-02 & 2005-06 Period to Forum where Forum Period to 2006-07 which it the dispute the which it 7/21/2009, 9:23 PM Appelate Tribunal,Mumbai ncome TaxAppelateTribunal ssioner ofCustoms(Appeals) Excise andServiceTax of IncomeTax(Appeals) ultra vires 121

BHARTI AIRTEL ANNUAL REPORT 2008-09 i) Access charges/Port Charges The Company has several claims from BSNL relating to transit charges, access charges (pre-IUC period) and Non-CLI calls. These claims are under litigation at various forum or at stages of mutual discussion for settlement. Pending settlement of these claims, the Company has disclosed the related amount as contingent liability. The management believes that the outcome of these contingencies would not result into any liability. Accordingly, no amounts have been accrued although some have been paid under protest. j) Others Others mainly include disputed demands for consumption tax, disputes before consumer forum and with respect to labour cases and a potential claim for liquidated damages. The management believes that, based on legal advice, the outcome of these contingencies will be favourable and that a loss is not probable. No amounts have been paid or accrued towards these demands. k) Bharti Mobinet Limited ('BMNL') litigation Bharti Airtel is currently in litigation with DSS Enterprises Private Limited (DSS) (0.34 per cent equity interest in erstwhile Bharti Cellular Limited (BCL)) for an alleged claim for specific performance in respect of alleged agreements to sell the equity interest of DSS in erstwhile BMNL to Bharti Airtel. The case filed by DSS to enforce the sale of equity shares before the Delhi High Court had been transferred to District Court and was pending consideration of the Additional District Judge. This suit was dismissed in default on the ground of non-prosecution. DSS had filed an application for restoration of the suit but has subsequently withdrawn the restoration application. In respect of the same transaction, Crystal Technologies Private Limited ('Crystal'), an intermediary, has initiated arbitration proceedings against the Company demanding Rs. 194,843 thousand included in Note 3 (b) above regarding termination of its appointment as a consultant to negotiate with DSS for the sale of DSS stake in erstwhile BMNL to Bharti Airtel. DSS has also filed a suit against a previous shareholder of BMNL and Bharti Airtel challenging the transfer of shares by that shareholder to Bharti Airtel. The suit was subsequently dismissed as frivolous, which has been appealed to in the Delhi High Court by DSS and subsequently transferred to District Court. DSS has also initiated arbitration proceedings seeking direction for restoration of the cellular license and the entire business associated with it including all assets of BCL/BMNL to DSS or alternatively, an award for damages. An interim stay has been granted by the Delhi High Court with respect to the commencement of arbitration proceedings. The liability, if any, of Bharti Airtel arising out of above litigation cannot be currently estimated. Since the amalgamation of BCL and erstwhile Bharti Infotel Limited (BIL) with Bharti Airtel, DSS, a minority shareholder in BCL, has been issued 2,722,125 equity shares of Rs. 10 each bringing the share of DSS in Bharti Airtel down to 0.14% as at March 31, 2009. The management believes that, based on legal advice, the outcome of these contingencies will be favourable and that a loss is not probable. Accordingly, no amounts have been accrued or paid in regard to this dispute. 4. Export Obligation Bharti Airtel has obtained licenses under the Export Promotion Credit Guarantee ('EPCG') Scheme for importing capital goods at a concessional rate of customs duty against submission of bank guarantee and bonds. Under the terms of the respective schemes, the Company is required to export goods of FOB value equivalent to, or more than, five times the CIF value of imports in respect of certain licenses and eight times the duty saved in respect of licenses where export obligation has been refixed by the order of Director General Foreign Trade, Ministry of Finance, as applicable within a period of eight years from the import of capital goods. The Export Promotion Capital Goods Scheme, Foreign Trade Policy 2004-2009 as issued by the Central Government of India, covers both manufacturer exporters and service providers. Accordingly, in accordance with Clause 5.2 of the Policy, export of telecommunication services would also qualify. Accordingly, the Company was required to export goods and services of FOB value of Rs. 2,596,473 thousand (March 31, 2008 Rs. 1,087,184 thousand). 5. a) Estimated amount of contracts to be executed on capital account and not provided for (net of advances) Rs. 29,526,399 thousand (March 31, 2008- Rs. 63,603,778 thousand). b) Under the IT Outsourcing Agreement, the Company has commitments to pay Rs. 7,563,213 thousand (March 31, 2008 Rs. 8,009,806 thousand).

5 Airtel main 98-148.p65 122 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 .Employeebenefits 6. )Theassumptionsusedtodeterminethebenefitobligationsareasfollows: b) )Duringtheyear,CompanyhasrecognizedfollowingamountsinProfit&LossAccount a) icutRt .0 7.50% Leave NA 7.50% Gratuity - 7.50% - - - 81,103 - Expected RateofReturnon Plan Assets - - 8,401 Expected RateofincreaseinCompensationlevels 75,029 Discount Rate - (13,666) - 18,363 - Particulars 88,695 For theyearendedMarch31,2009 94,819 - - # IncludedinSalaries,WagesandBonus(ReferSchedule 16) Net cost - Curtailment andSettlementcost/(credit) - cost service Past 8,777 Actuarial (gain)/loss Expected Returnonplan (7,094) - Interest cost 24,644 Current servicecost 121,656 Particulars - 137,385 1,093 For theYearendedMarch31,2008 Net cost Curtailment andSettlementcost/(credit) cost service Past 755 Actuarial (gain)/loss Expected Returnonplan Interest cost Current servicecost Particulars For theyearendedMarch31,2009 basis ofanactuarialvaluationonprojectedunitcreditmethodmadeattheendeachfinancialyear. Gratuity liabilityandleaveencashmentaredefinedbenefitobligationsprovidedforonthe Defined BenefitPlans @ IncludesContributiontoDefinedPlanforKeyManagerialPersonnel(ReferNote16below) # IncludedinSalaries,WagesandBonus(ReferSchedule16) * IncludedinContributiontoProvidentandOtherFunds(ReferSchedule16) Employer’s ContributiontoESI* Expected Average remaining working lives of employees (years) 25.23 years 25.23 years 25.23 years 25.23 Expected Averageremaining workinglivesofemployees(years) mlyrsCnrbto oSpranainFn ,6 1,173 415,323 2,162 430,173 Employer’s ContributiontoSuperannuationFund# Employer’s ContributiontoProvidentFund*@ Particulars Defined ContributionPlans Teefe .0 7.00% 15.00% 7.00% 15.00% -Thereafter -Ist ThreeYears 123 ses(,6) 4 (4,768) assets (30) (4,864) assets 9,0 5162225299,261 212,215 15,106 197,109 206,802 296,764 17,943 278,821 uddUfne oa Unfunded Total Unfunded Funded Unfunded Total Unfunded Funded rtiy#LeaveEncashment# Gratuity # LeaveEncashment# Gratuity # 2,6 1516190,667 115,186 20,367 137,873 153,675 16,290 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 145234,078 114,562 (,9)- (4,894) 2,6 27,491 26,764 34,851 33,421 ereddYearended Year ended 474 - (4,764) o h Forthe For the Encashment (Rs. ‘000) (Rs. ‘000) (Rs. ‘000) 123

BHARTI AIRTEL ANNUAL REPORT 2008-09 For the year ended March 31, 2008

Particulars Gratuity Leave Encashment Discount Rate 7.50% 7.50% Expected Rate of increase in Compensation levels 7.00% 7.00% Expected Rate of Return on Plan Assets 7.50% NA Expected Average remaining working lives of employees (years) 25.85 years 25.85 years c) Reconciliation of opening and closing balances of benefit obligations and plan assets For the year ended March 31, 2009 (Rs. ‘000) Particulars Gratuity Leave Encashment Funded Unfunded Total Unfunded Change in projected benefit obligation (PBO) Projected benefit obligation at beginning of year 345,363 100,257 445,620 464,676 Current service cost 137,385 16,290 153,675 137,873 Interest cost 24,644 8,777 33,421 34,851 Benefits paid - (84,228) (84,228) (193,843) Curtailment and Settlement cost - - - - Contribution by plan participants - - - - Past service cost - - - - Actuarial (gain)/loss (4,937) 114,605 109,668 34,077 Projected benefit obligation at year end 502,455 155,701 658,156 477,634 Change in plan assets : Fair value of plan assets at beginning of year 65,247 - 65,247 - Expected return on plan assets 4,894 - 4,894 - Actuarial gain/(loss) (4,893) - (4,893) - Employer contribution 10,634 - 10,634 - Contribution by plan participants - - - - Settlement cost - - - - Benefits paid - - - - Fair value of plan assets at year end 75,882 - 75,882 - Net funded status of the plan (426,573) (155,701) (582,275) (477,634) Net amount recognized (426,573) (155,701) (582,275) (477,634)

For the year ended March 31, 2008 (Rs. ‘000) Particulars Gratuity Leave Encashment Funded Unfunded Total Unfunded Change in projected benefit obligation (PBO) Projected benefit obligation at beginning of year 244,757 112,093 356,850 366,542 Current service cost 94,819 20,367 115,186 190,667 Interest cost 18,363 8,401 26,764 27,491 Benefits paid (21,258) (102,217) (123,475) (201,127) Curtailment and Settlement cost - - - - Contribution by plan participants - - - - Past service cost - - - - Actuarial (gain)/loss 8,682 61,613 70,295 81,103 Projected benefit obligation at year end 345,363 100,257 445,620 464,676 Change in plan assets : Fair value of plan assets at beginning of year 63,526 - 63,526 - Expected return on plan assets 4,764 - 4,764 - Actuarial gain/(loss) (4,733) - (4,733) - Employer contribution 23,219 - 23,219 - Contribution by plan participants - - - - Settlement cost - - - - Benefits paid (21,529) - (21,529) - Fair value of plan assets at year end 65,247 - 65,247 - Net funded status of the plan (280,116) (100,257) (380,373) (464,676) Net amount recognized (280,116) (100,257) (380,373) (464,676)

5 Airtel main 98-148.p65 124 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 7. )TheCompanyentered into aJointVenturewith9otheroverseasmobile operatorstoformaregional b) Joint Ventures MovementinprovisionforDeferredIncentivePlan i) Thetablebelowillustratesexperienceadjustment disclosureasperpara120(n)(ii)ofAccountingStandard h) EstimatedamountsofbenefitspayablewithinnextyearareRs.242,918thousand(March31,2008 g) TheCompanymadeannualcontributionstotheLICofanamountadvisedbyLIC.wasnot f) Theestimatesoffuturesalaryincreases,consideredinactuarialvaluation,takeaccountinflation,seniority, e) Theexpectedrateofreturnonplan assets wasbasedontheaveragelong-termrateofreturnexpectedto d) )TheCompanyhasparticipatedinvariousconsortiumstowardssupply,construction,maintenanceandproviding a) Jointly ownedassets Investment inJointVentures/Jointlyownedassets: Particulars lnast 7,8 6,4 6,2 - - - - (366,542) 63,526 (464,676) 65,247 (39,808) (477,634) (293,323) (82,181) 75,881 (380,373) (582,275) Experience adjustments on planliabilities Experience adjustments Surplus / (deficit) Plan assets Defined benefitobligati AS rjc 2,5 2,5 - - - 29,753 1,157,698 1,212,110 1,157,698 29,753 1,212,110 Unity -ProjectCommon IMEWE- Project EIG -Project EASSY -Project AAG -Project M- SMW-4 al rjc oa otiuinCapital Unity -ProjectLightUp - Contribution Total - Cable Project - 393 (4,733) (4,894) assets plan on interest 10.00%) 10.00% asatMarch31,2008 (March31,2007:USD2,200thousand,Rs.92,237 thousand,ownership thousand, in2,200thousand ordinarysharesofUSD1eachwhichisequivalenttoan ownershipinterestof Mobile AllianceProgramme. TheCompanyhasinvestedUSD2,200thousand,amounting toRs.92,237 principal activityoftheventure iscreatinganddevelopingregionalmobileservices managingtheBridge alliance calledtheBridgeMobile AllianceincorporatedinSingaporeasBridgeMobile PteLimited.The 15, 'EmployeeBenefits' Rs. 220,206thousand). informed byLICoftheinvestmentsmadeorbreak-downplanassetsinvestmenttype. promotion andotherrelevantfactors,suchassupplydemandintheemploymentmarket. based ontheaverageyieldgovernmentbondsof20years. returns suitablyadjustedformovementsinlong-termgovernmentbondinterestrates.Thediscountrateis prevail overthenext15to20yearsoninvestmentsmadebyLIC.Thiswasbasedhistorical Particulars lsn aac 4028103,172 218,042 470,248 222,578 107,708 103,172 96,721 463,797 long termtechnicalsupportwithregardstofollowingCableSystems.Thedetailsofthesameareasfollows: Balance Closing Less :Utilizedduringtheyear Add: Additionduringtheyear Balance Opening 125 n 5,5 4560 5,4 4764 6,7 366,542 464,676 477,634 356,849 445,620 658,156 on ended March ended March ended March ended March ended March ended March ended endedMarch endedMarch endedMarch endedMarch March ended o h erFrteya o h erFrteya o h erFortheyear Fortheyear Fortheyear Fortheyear Fortheyear For theyear 3,20 3,20 3,20 3,20 3,20 31,2007 31,2008 31,2009 31,2007 31,2008 31,2009 2,514,188 331,727 1,763,754 331,727 2,514,188 R.‘0)(s 00 (Rs.‘000) (Rs.‘000) (Rs. ‘000) 5039 5,8 - 550,389 550,389 2,3 3399 10% - 323,939 323,939 4,4 4,4 - 40,541 40,541 rtiyLeaveEncashment Gratuity 160 1,3) 6,9)36,970 (68,090) (16,439) 41,650 rgesMarch 31, Progress Work In WDV as at Share % Share WDVasat In Work 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 ereddyearended year ended o h Forthe For the 2009 (Rs. ‘000) 12.79% 10.76% 13.91% 7.09% 1.11% 7.08% 125

BHARTI AIRTEL ANNUAL REPORT 2008-09 c) The following represent the Company's share of assets and liabilities, and income and results of the joint venture. (Rs. ‘000) Particulars As at As at March 31, 2009 March 31, 2008 Balance Sheet Reserve and surplus (5,966) (19,325) Fixed assets, (net) 9,901 11,603 Investments -- Current assets Sundry Debtors 6,711 - Cash and bank 76,508 68,541 Loans and advances - 4,417 Current liabilities and provisions 7,154 11,955 (Rs. ‘000) Particulars For the For the year ended year ended March 31, 2009 March 31, 2008 Profit & Loss Account Service revenue 17,244 14,245 Other income - 1,478 Expenses Operating expenses 14,876 11,732 Selling, general and administration expenses 5,845 8,751 Finance expenses/(income) (2,153) (1,776) Depreciation 4,536 3,982 Profit/(Loss) (5,860) (6,966) 8. During the year ended March 31, 2005 the Company issued USD 115,000,000 Zero Coupon Convertible Bonds due 2009 (the “FCCBs”). The FCCBs are convertible at any time on or after June 12, 2004 (or such earlier date as is notified to the holders of the FCCBs by the Issuer) up to April 12, 2009 by holders into fully paid equity shares with full voting rights with a par value of Rs. 10 each of the Issuer (“Shares”) at an initial Conversion Price (as defined in the “Terms and Conditions of the FCCBs”) of Rs. 233.17 per share with a fixed rate of exchange on conversion of Rs. 43.56 = USD 1.00. The Conversion Price is subject to adjustment in certain circumstances. The FCCBs could be redeemed, in whole or in part, at the option of the Issuer at any time on or after May 12, 2007 and prior to April 12, 2009, subject to satisfaction of certain conditions, at their “Early Redemption Amount” (as defined in the “Terms and Conditions of the FCCBs”) at the date fixed for such redemption if the “Closing Price” (as defined in the “Terms and Conditions of the FCCBs”) of the Shares translated into U.S. dollars at the “prevailing rate” (as defined in the “Terms and Conditions of the FCCBs”) for each of 30 consecutive “Trading Days” (as defined in the “Terms and Conditions of the FCCBs”), the last of which occurs not more than five days prior to the date upon which notice of such redemption is published, is greater than 120 per cent of the “Conversion Price” (as defined in the “Terms and Conditions of the FCCBs”) then in effect translated into U.S. dollars at the rate of Rs. 43.56 = USD 1.00. The FCCBs could also be redeemed in whole, and not in part, at any time at the option of the Issuer at their Early Redemption Amount if less than 5 per cent in aggregate principal amount of the FCCBs originally issued is outstanding. The FCCBs could also be redeemed in whole, at any time at the option of the Issuer at their Early Redemption Amount in the event of certain changes relating to taxation in India. The Issuer will, at the option of any holder of any FCCBs, repurchase at the Early Redemption Amount such FCCBs at such time as the Shares cease to be listed or admitted to trading on the NSE or upon the occurrence of a “Change of Control” (as defined in the "Terms and Conditions of the FCCBs") in respect of the Issuer. These FCCBs were listed in the Singapore Exchange Securities Trading Limited (the “SGX-ST”). The Company has during the year ended March 31, 2009, converted FCCBs equivalent to USD 500,000 into 93,408 equity shares of the Company at the option exercised by the bond holders which is as follows:

Date of Allotment No. of shares allotted FCCB value (USD) 2-Jun-08 93,408 500,000 Total 93,408 500,000

5 Airtel main 98-148.p65 126 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 13. 12. 11. 10. 9. oa 517,304 17,304 FollowingshallbeexcludedfromSecuritiesasmentionedabove:- Note : Total Vehicle LoanFromBank Amount from Dec2009 repayment commencing Rs. 10,000thousand Redeemable Debenturesof 11.70%, 50Non-convertible Debentures Particulars Particulars ofsecuritieschargedagainstsecuredloanstakenbytheCompanyareasfollows: LoanandadvanceinthenatureofloanbearingnilinterestgiventoBhartiTelemediaLimitedRs.6,384,291 (b) Loansandadvancesinthenatureofloanshavebeengiventosubsidiaries.Refernote23belowforamount (a) Rs. 340,299thousand(March31,2008286,177thousand). Sales andMarketingunderSchedule17includesgoodwillwaiverswhichareotherthantradediscount,of up. held byBhartiTele-VenturesEmployee'sWelfareTrustissuedattherateofRs.51.36perequitysharefullypaid As atMarch31,20092,090,245equityshares(March20082,317,645shares)oftheCompanyare security depositreceivedfromthem. Sundry debtorsaresecuredtotheextentofamountoutstandingagainstindividualsubscribersbyway repayable ondisconnection,netofoutstanding,ifanyandsecuritydepositsreceivedfromchannelpartners. refundable securitydepositsreceivedfromsubscribersonactivationofconnectionsgrantedtheretoandare Rs. 3,424,931thousand(March31,20083,478,690thousand)includedunderCurrentLiabilities,represents amount aftercompletionofthestatutoryformalities. The balanceFCCBsequivalenttoUSD50,000willberedeemedinUSDollarsat111.84%oftheirprincipal 350,000 convertibleinto65,385equitysharesofthecompany. Before April12,2009theCompanyhasreceivednoticesforconversionofFCCBs,equivalenttoUSD thousand. outstanding andmaximumamountduringtheyear. )LicensesissuedbyDoTtoprovidevarioustelecomservices. c) InvestmentinsubsidiariesofBhartiAirtel. b) IntellectualpropertiesofBhartiAirtel. a) 127 ah500,000 each Outstanding (Rs. ’000) } Allrights,titles,interestsintheaccounts,and monies • Firstrankingparipassuchargeonallpresentand • company. Secured byHypothecationofVehiclesthe project documents,bookdebtsandinsurancepolicies. deposited andinvestmentsmadetherefromin fixtures fittings,sparestoolsandaccessories and machinery,officeequipment,furniture assets ownedbyBhartiAirtelLimitedincludingplant future tangiblemovableandfreeholdimmovable 7/21/2009, 9:23 PM Security Charges 127

BHARTI AIRTEL ANNUAL REPORT 2008-09 14. Expenditure/Earnings in Foreign Currency (on accrual basis) : (Rs. ‘000) Particulars For the For the year ended year ended March 31, 2009 March 31, 2008 Expenditure On account of : Interest 1,999,983 1,689,932 Professional and Consultation Fees 122,323 444,809 Travelling 1,773 2,392 Roaming Charges (Incl. Commission) 2,860,862 2,407,908 Membership and Subscription 14,277 16,134 Staff Training and Others 63,827 29,143 Network Services 915,886 309,442 Annual Maintenance 502,434 332,433 Bandwidth Charges 1,144,713 1,099,062 Access Charges 11,890,341 10,351,147 Software 26,031 55,358 Marketing 25,956 10,284 Upfront fee on borrowings 74,907 154,128 Content Charges 3,098 - Charity and Donation 17,801 - Point of Presence Charges 100,601 73,903 Directors Commission and Sitting Fees 5,662 8,664 Agency Fees and Premium fees 59,794 - Listing Fees 32 - Total 19,830,301 16,984,739 Earnings Roaming Revenue 4,892,441 2,934,558 Billing Revenue 13,173,828 12,445,764 Management Charges 27,285 - Total 18,093,554 15,380,322 15. CIF Value of Imports : (Rs. ‘000) Particulars For the For the year ended year ended March 31, 2009 March 31, 2008 Capital Goods 33,833,931 48,678,095 Total 33,833,931 48,678,095 16. The aggregate managerial remuneration under section 198 of the Companies Act, 1956 to the directors (including managing director) is: (Rs. ‘000) Particulars For the For the year ended year ended March 31, 2009 March 31, 2008 Whole-time directors Salary 111,193 101,704 Contribution to Provident fund and other funds 12,949 12,204 Reimbursements and Perquisites 595 470 Performance Linked Incentive 151,686 150,120 Total Remuneration payable to whole-time directors 276,423 264,498 Non Whole-time directors Commission 14,056 10,903 Sitting Fees 480 739 Total amount paid /payble to non whole-time directors 14,536 11,642 Total Managerial Remuneration 290,959 276,140

* As the future liability for Gratuity and Leave Encashment is provided on actual basis for the Company as a whole, the amount pertaining to Directors is not ascertainable and, therefore, not included above.

5 Airtel main 98-148.p65 128 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 7 AuditorsRemuneration: 17. 18 Amountsduetomicro,andsmallenterprisesunderMicro,SmallMediumEnterprisesDevelopmentAct, . Particulars Remuneration payabletoDirectors. Computation ofNetProfitinaccordancewithSection349theCompaniesAct,1956,andcalculation mutPi aal oDrcos 9,5 276,140 290,959 32,075 7,120,647 712,065 1,172,833 11,642 264,498 8,455,179 (38,899) Remuneration paid/payabletodirectorfromsubsidiarycompanyRs.39,120thousand(March31,2008Nil). 2,684,358 845,518 are higherthantheminimumprescribedrateasperScheduleXIV. 14,536 276,423 implicit inScheduleXIVoftheCompaniesAct,1956.AccordinglyratesdepreciationfollowedbyCompany * TheCompanyprovidesdepreciationonFixedAssetsbasedusefullivesofassetsthatarelowerthanthose 34,326,534 Amount Paid/PayabletoDirectors 34,326,534 Restricted to10% Maximum Amountpaid/payabletowhole-timedirectors 33,850,990 33,850,990 Restricted to1% Maximum amountpaid/payabletononwhole-timedirectors Net Profit/(Loss)fortheyearUnderSection349 Less: DepreciationunderSection350oftheCompaniesAct,1956 Add: Provisionfordoubtfuldebtsandadvances Add: (Profit)/LossonSalesofFixedAssets Add: DepreciationandAmortisationprovidedinthebooks* Add: AmountPaidtoNonwhole-timedirectors Add: Remunerationtowhole-timedirectors Net Profitbeforetaxfrom Company andtheconfirmationreceivedfromcreditorstillyearend.: 2006 aggregatetoRs.44,258thousand(March31,2008-Nil)basedontheinformationavailablewith i aainmtes 10Nil Nil 18,000 Nil 2,403 6,239 150 Nil Nil 4,659 * ExcludingServiceTax Total - ReimbursementofExpenses* - inanyothermanner* and services; management (iii) companylawmatters; (ii) taxationmatters; (i) - Asadviser,orinanyothercapacity,respectof- Audit Fee* rN Particulars Sr No Theamountoffurther interestremainingdueandpayableeveninthe Theamount ofinterestaccruedandremainingunpaidattheend 5 4 Theamount ofinterestdueandpayablefortheperioddelayin 3 Theamountofinterestpaidbythebuyerintermssection16 2 871 thousand Theprincipalamountandtheinterestduethereon[Rs. 1 Medium EnterpriseDevelopment Act,2006. as adeductibleexpenditure under section23oftheMicroSmalland are actuallypaidtothesmallenterprise forthepurposeofdisallowance succeeding years,untilsuch datewhentheinterestduesasabove each accountingyear; Micro SmallandMediumEnterpriseDevelopmentAct,2006. day duringtheyear)butwithoutaddinginterestspecified under making payment(whichhavebeenpaidbutbeyondthe appointed the appointeddayduringeachaccountingyear. along withtheamountsofpaymentmadetosupplier beyond the MicroSmallandMediumEnterpriseDevelopment Act, 2006, the endofeachaccountingyear (March 31,2008–Rs. Nil)] remainingunpaidtoanysupplierasat 129 riayatvte 81,615,367 ordinary activities 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 ac 1 09March31,2008 March 31,2009 8,5,8 71,206,471 84,551,785 ereddYearended Year ended ereddyearended year ended 99644,553 49,936 24,150 38,888 o h Forthe For the ac 1 March31, March 31, 7 - -- 871 -- - -- 44,258 092008 2009 69,725,423 (Rs. ‘000) (Rs. ‘000) 129

BHARTI AIRTEL ANNUAL REPORT 2008-09 19. Quantitative Information 2008-09 Particulars Year ended Purchases Utilisation Sales Year ended March 31, 2008 (Refer note 1 below) (Refer note 4 below) (Refer note 5 below) March 31, 2009 2008-09 2008-09 2008-09 Qty Value Qty Value Qty Value Qty Value Qty Value Nos. (‘000) Nos. (‘000) Nos. (‘000) Nos. (‘000) Nos. (‘000) Simcards (Refer Note 2 below) 28,638,046 548,788 78,966,688 1,835,243 79,757,550 1,618,471 - 459 27,847,184 602,211 TDMA/PAMA VSATs Assembly - 2,453 - 73,899 - 63,324 - 8,211 - 6,646 sets (Refer Note 3 below) Internet Modem, Handsets - 17,366 - 960,285 - 1,010,678 - 138,480 - 12,653 Antennae and others (Refer Note 3 below) 568,607 2,869,427 2,692,473 147,150 621,510

2007-08 Particulars Year ended Acquired Under Purchases Utilisation Sales Year ended March 31, 2007 scheme of (Refer note 1 below) (Refer note 4 below) (Refer note 5 below) March 31, 2008 Amalgamation 2007-08 2007-08 2007-08 2007-08 Qty Value Qty Value Qty Value Qty Value Qty Value Qty Value Nos. (‘000) Nos. (‘000) Nos. (‘000) Nos. (‘000) Nos. (‘000) Nos. (‘000) Simcards (Refer Note 2 below) 21,317,524 464,994 - - 56,183,084 884,522 48,862,562 800,728 - 37,795 28,638,046 548,788 TDMA/PAMA VSATs Assembly sets (Refer Note 3 below) - 3,761 - 6,510 - 229 - 3,817 - 268,711 - 2,453 Internet Modem, Handsets Antennae & others (Refer Note 3 below) - 9,390 - 7,885 - 1,468,945 - 1,120,187 - 81,077 - 17,366

478,145 14,395 2,353,696 1,924,732 387,583 568,607

(1) Includes cost transferred from Fixed Assets. (2) Excludes value of simcards issued free of cost. (3) The quantitative information for TDMA/PAMA VSATs, Assembly sets, Modems, handsets antennas and others has not been given since they constitute voluminous small items. (4) Utilisation includes internal utilisation. (5) Includes deferred revenue recognized during the year with respect to sim cards. 20. The details of investments required as per Schedule VI of the Companies Act 1956 are provided below: (a) Details of Investments held as at March 31, 2009 (Rs. ‘000) Particulars As at March As at March As at March As at March 31, 2009 31, 2009 31, 2008 31, 2008 (No. of Units) Cost (No. of Units) Cost Other than Trade (Unquoted)- Deposits & Bonds 7.30% REC Secured Bonds 30 27,703 30 27,069 7.16% Certificate of Deposit of Axis Bank Ltd 2,500 247,284 - - 7.23% Certificate of Deposit of Kotak Bank Ltd 2,500 247,306 - - 6.75% Certificate of Deposit of Allahabad Bank 5,000 492,800 - - 7.59% Certificate of Deposit of Yes Bank 2,500 247,407 - - 6.87% Certificate of Deposit of Punjab National Bank 2,000 195,907 - - 6.87% Certificate of Deposit of Punjab National Bank 500 48,977 - - 6% ICD with Rabo India Finance Limited 1 250,000 - - Total (A) 1,757,384 27,069 Other than trade (Unquoted) - Government Securities National Saving Certificate 18 1,800 18 1,800 Deposits - 35 - 39 Total (B) 1,835 1,839 Other than Trade (Quoted)- Mutual Funds and Bonds Birla Sun Life Medium Term Plan - Instl Growth 50,000,000 500,000 - - HDFC Liquid Fund - Premium Plan - Growth * 115,190,391 2,027,711 61,726,490 1,000,000 Principal Cash Management Fund Liquid Option Instl. 7,662,244 103,738 59,399,824 750,000 Prem. Plan - Growth ICICI Prudential Institutional Liquid Plan - Super Institutional Growth 143,331,889 1,858,426 62,949,565 750,000 Canara Robeco Floating Rate Short Term Fund Growth Fund 7,369,197 100,000 - - Templeton India Treasury Management Account Super 261,789 331,150 208,451 250,000 Institutional Plan - Growth TATA Floater Fund - Growth 31,654,324 406,787 - - Religare Liquid Fund - Super Institutional Growth 4,321,579 51,929 44,998,020 500,000 Birla Sun Life Cash Plus - Instl. Prem. - Growth 55,092,791 774,748 77,437,740 1,000,000

5 Airtel main 98-148.p65 130 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 atclr As at M Particulars OA A B C 0512515,7 20,551,225 50,000 50,000 500,000 - 300,000 1,000,000 39,462,053 250,000 78,972,723 250,000 26,903,175 150,522 - 500,000 - - 25,000,000 - 25,000,000 11,018,378 163,246 - 479,316 750,000 - - 750,000 500,000 - 15,634,166 - - 647,789 - 152,007 - TOTAL (A)+(B)(C) 58,741,982 1,139,373 41,583,846 250,000 - - Total (C) - - - - 11,934,834 - 1,043,485 1,850,000 20,726,591 - - - Principal FloatingRateFundSmpInst.Option-GrowhPlan - - 145,637,182 Reliance FloatingRateFund-GrowthPlan-GrowthOption - - 56,208 AIG ShortTermFundInstitutionalGrowth - - - - HDFC Fmp90DJune2008(Viii)(1)-WholesalePlanGrowth - IDFC FixedMaturityPlan-QuarterlySeries25Growth - - Wholesale Option-Growth 35,824 - - HDFC FloatingRateIncomeFund-ShortTermPlan DBS CholaLiqSupInst.Plan-Cumulative - - - AIG IndiaTreasuryPlusFundSuperInstitutionalGrowth - - - AIG IndiaLiquidFund-SuperInstitutionalGrowth Principal FloatingRateFund-Fmp-Insti.OptionGrowthPlan - - Reliance LiquidPlusFund-InstitutionalOptionGrowthPlan Plan-Institutional Option-Growth - - 867,940 Templeton FloatingRateIncomeFund-ShortTerm - 88,044 HSBC CashFund-InstitutionalPlanGrowth - - 50,000 750,000 - ING LiquidFundSuperInstitutional-GrowthOption 47,904,440 - - IDFC LiquidityManager-PlusGrowth 102,353 8,688,053 Tata FloatingRateShortTermInst.Plan-Growth - 563,236 - 5,000,000 TATA LiquidSuperHighInv.Fund - - - 5,264,874 Bharti AxaShortTermIncomeFund-InstitutionalPlan-Growth 164,279 - 500,000 - 83,861 Super InstPlanC-Growth 1,018,788 - IDFC MoneyManagerFund-T 162,170 - 161,378 Birla SunLifeShortTermFund-InstitutionalGrowth 707,797 450,113 37,488,847 - Growth Plan-Option 83,861 - 201,571 - 8,853,107 100,000 Reliance MediumTermFund-RetailPlan 885,867 Bharti AxaTreasuryAdvantageFund-InstitutionalPlanGrowth - 43,166,002 522,072 2,155,140 Bharti AxaLiquidFund-SuperInstitutionalPlanGrowth 200,000 19,683,683 8,846,270 351,982 63,860,748 SBI MagnumInstaCashFund-Option 300,000 1,329,729 Sundaram BNPParibasMoneyFundSuperInst.Growth 37,944,996 401,304 50,010 16,516,913 UTI LiquidCashPlanInstitutional-GrowthOption 31,284,742 2,303,180 1,000,000 22,651,083 Fidelity UltraShortTermDebtFundSuperInstitutional-Growth 100,016 500,000 35,374,038 JM HighLiquidityFund-SuperInstitutionalPlanGrowth 93,850,910 95,466,305 3,824,517 DWS UltraShortTermFund-InstitutionalGrowth 1,641,502 7,092,508 Religare QuarterlyIntervalFund-PlanFGrowth 30,768,095 JP MorganIndiaTreasuryFund-SuperInst.GrowthPlan 143,887,898 Tata LiquidSuperHighInv.Fund-Appreciation DWS InstaCashPlusFund-SuperInstitutionalPlanGrowth ICICI PrudentialFlexibleIncomePlanPremium-Growth Kotak FloaterLongTerm-Growth Reliance LiquidityFund-GrowthOption DBS CholaFreedomIncomeSTP-Inst.-Cum-Org UTI MoneyMarketFund-GrowthPlan Fortis MoneyPlusInstitutionalGrowth 131 reasury Plan 12479531, 51,224,769 - (No. ofUnits) 1 093,20 1 0831,2008 31,2008 31,2009 31, 2009 rhA tMrhA tMrhAsatMarch AsatMarch AsatMarch arch 7/21/2009, 9:23 PM 8720615,705,261 18,792,006 Cost 3 -- - 230 (No. ofUnits) (Rs. ‘000) 34,169 Cost 131

BHARTI AIRTEL ANNUAL REPORT 2008-09 (b) Details of trade investment purchased and sold during the year

Trade investment Balance as on Purchased Sale / Redemption April 1, 2008 During the Year Units (Rs. ‘000) Units (Rs. ‘000) Units (Rs. ‘000)

Investment in Subsidiaries Bharti Hexacom Limited 166,501,980 5,207,748 8,498,000 509,880 - - Bharti Infratel Limited * 50,000 82,181,703 499,950,000 - - - Bharti Telemedia Limied 4,080,000 40,902 - - - - Bharti Aquanet Limited # 2,500,000 261,549 - - 2,500,000 261,549 Network i2i Limited 9,000,000 5,316,039 - - - - Bharti Airtel Lanka (Private) Limited 100 - 525,596,320 2,049,411 - - Bharti Airtel (Canada) Limited 100 4 - - - - Bharti Airtel (Hongkong) Limited ** 1 26,333 4,959,479 - - - Bharti Airtel (Singapore) Private Limited** 1 20,139 750,000 - - - Bharti Airtel Holdings (Singapore) Pte Limited@ 1 - - 1,106,553 - - Bharti Airtel (UK) Limited** 1 87,609 123,662 13,003 - - Bharti Airtel (US) Limited** 200 508,971 100 - - - Bharti Airtel Services Limited 100,000 1,000 - - - - Investment in Joint Ventures Bridge Mobile Pte. Limited 2,200,000 92,237 - - - - Investment in Associates Bharti Teleports Limited - - 1,470,000 14,700 - - Others Investment in IFFCO JV 100,000 50125 - - - - Total Trade Investment 93,794,359 3,693,547 261,549

* Bonus shares alloted during the year. # Merged with Bharti Airtel Limited as on January 1, 2009 (Refer note 2 (b) on Schdule 22) ** Shares alloted during the year against share application money. @ Share Application Money (Pending allotment)

c) In terms of the approval granted by the Central Government vide its letter No. 46/90/2009-CL-III dated April 21, 2009 under Section 211(4) of the Companies Act, 1956, the Company has been exempted from the requirement of the disclosure of the movement relating to purchase and sale of other than trade investments.

5 Airtel main 98-148.p65 132 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 21. 2 Information aboutBusinessSegments-Primary 22. Particulars Site RestorationCost: notified underCompaniesAccountingStandardsRules,2006('asamended'),isgivenbelow: movement ofProvisioninaccordancewithAS-29'Provisions,ContingentLiabilitiesandAssets' will beutilizedattheendofleaseperiodrespectivesitesasperagreements.The be incurredfortherestorationofthesepremisesatendleaseperiod.Itisexpectedthatthisprovision The Companyusesvariouspremisesonleasetoinstalltheequipment.Aprovisionisrecognizedforcosts ercainadaotsto 2,9,9 60452 ,0,0 15335 4,5 (,2,2)33,850,990 (2,623,627) 448,558 1,593,395 4,300,307 6,034,562 24,097,795 amortisation and Depreciation Total Eliminations Others Enterprise Enterprise Telemedia Mobile Reportable Segments For theyearendedMarch31,2009 ofarrangement(ReferNote2(b)onSchedule22). scheme *Transferred toBhartiInfratelLimitedasperthe Closing Balance diindrn h er8941,104,817 3,257,028 8,984 1,150,541 Less :Transferredunderthe Addition duringtheyear Opening Balance dac a - - 8426 894,226 - 3,271,103 - 894,226 - 358,731 (1,396,304) 9,173,614 3,271,103 - - - - - (3,959,059) - (1,396,304) 358,731 9,173,614 - 214,660,291 ------(3,959,059) 17,639,842 214,660,291 (238,694,949) 152,101,721 - 11,600,066 - - - 84,277,101 84,195,380 - 55,256,447 6,149,105 - 491,099,935 (238,694,949) 67,906,341 (238,694,949) 144,724,869 - - 150,119,905 486,934,606 29,726,966 - 23,981,740 5,450,961 147,712,737 67,180,180 7,928,447 60,295,361 - 340,450,132 17,639,842 - 92,405,619 47,328,000 - - 57,714,286 - 77,438,385 - Capital Expenditur (238,694,949) 458,805 - 140,100,735 Liabilities Total 12,184,072 81,615,367 Liabilities Segment Inter 65,566,906 17,542,894 - - - Liabilities Segment 50,331,323 82,145,831 - 218,751,570 16,848,857 Total Assets - - - 121,698,562 (Net ofprovisionfortax) (26,176,707) 5,772,574 Advance Tax 25,698,802 Deferred TaxAsset - 99,255,209 (21,999,725) 8,149,339 5,772,574 Inter SegmentAssets - - Segment Assets 63,994,377 25,698,802 (57,143,920) 341,550,270 - Other Information (57,143,920) 8,149,339 361,850 Net Profit/(Loss)aftertax 63,994,377 341,550,270 - - DeferredTax(Credit)/Charge 15,094,615 - FringeBenefitTax (4,359,883) - 67,389,514 -MAT Credit 5,772,574 33,115,412 3,941,886 - CurrentTax 282,732,799 25,698,802 Provision forTax 43,203,270 8,149,339 361,850 2,184,489 Profit/(Loss) Net 63,994,377 Net FinanceExpense/(Income) 7,814,275 11,152,729 Profit/(Loss) Result, Segment 24,186,244 Results 30,930,923 Revenue Total 274,918,524 Inter SegmentRevenue Goods andOtherIncome of Revenue/Sale Service Revenue 133 e 7,9,0 1,5,0 2,1,3 30447 3,9 (94879 94,581,880 (19,428,759) 334,392 3,014,407 20,316,433 16,554,505 73,790,902 Scheme ofArrangement* evcsSrie evcsServices Services Services Services aresCorporate Carriers 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 ereddyearended year ended 8282 (3,211,304) (882,872) 7,5 1,150,541 276,653 o h Forthe For the (Rs. ‘000) (Rs. ’000) 133

BHARTI AIRTEL ANNUAL REPORT 2008-09 For the year ended March 31, 2008 (Rs. ’000) Reportable Segments Mobile Telemedia Enterprise Enterprise Others Eliminations Total Services Services Services Services Carriers Corporate Revenue Service Revenue/Sale of 200,977,027 27,198,148 21,867,022 9,301,712 49,768 - 259,393,677 Goods and Other Income Inter Segment Revenue 5,053,513 1,201,863 21,541,899 3,343,008 - (31,140,283) - Total Revenue 206,030,540 28,400,011 43,408,921 12,644,720 49,768 (31,140,283) 259,393,677 Results Segment Result, 55,388,152 6,136,197 11,600,696 5,059,857 (3,622,399) - 74,562,503 Profit/(Loss) Net Finance Expense/ - - - - 4,837,080 - 4,837,080 (Income) Net Profit/(Loss) 55,388,152 6,136,197 11,600,696 5,059,857 (8,459,479) - 69,725,423 Provision for Tax - Current Tax - - - - 8,835,340 - 8,835,340 - MAT Credit - - - - (241,767) - (241,767) - Fringe Benefit Tax - - - - 372,293 - 372,293 - Deferred Tax (Credit)/ Charge - - - - (1,682,365) - (1,682,365) Net Profit/(Loss) after tax 55,388,152 6,136,197 11,600,696 5,059,857 (15,742,980) - 62,441,922 Other Information Segment Assets 181,196,798 41,143,736 50,326,079 10,950,722 106,209,249 - 389,826,584 Inter Segment Assets 63,944,556 3,415,183 51,267,864 7,944,749 5,384,534 (131,956,886) - Advance Tax (Net of provision for tax) - - - - 119,902 - 119,902 Total Assets 245,141,354 44,558,919 101,593,943 18,895,471 111,713,685 (131,956,886) 389,946,486 Segment Liabilities 128,198,487 7,386,028 19,741,133 5,938,551 25,628,669 - 186,892,868 Inter Segment Liabilities 20,828,994 33,088,439 42,213,069 611,767 35,214,617 (131,956,886) - Deferred Tax Liability - - - - 638,684 - 638,684 Total Liabilities 149,027,481 40,474,467 61,954,202 6,550,318 61,481,970 (131,956,886) 187,531,552 Capital Expenditure 83,653,965 11,063,082 13,664,122 6,521,552 2,234,407 (20,047,820) 97,089,308 Depreciation and amortisation 25,857,327 5,475,156 3,316,891 1,029,786 192,094 (1,544,720) 34,326,534

Segment Definitions Mobile Services – These services cover telecom services provided through cellular mobile technology wherein a subscriber is connected to the network through wireless equipment. The subscriber can freely roam around anywhere and stay connected wherever the wireless network coverage is available. Telemedia Services (formerly Broadband and Telephone Services) – These services are provided through wireline connectivity to the subscriber. The end-user equipment is connected through cables from main network equipment (i.e. switch) to subscriber's premises. Enterprise Services Carriers – The domestic and international long distance services are intermediary services provided to the service providers of cellular or fixed line services. Using these services, these other service providers route their long distance calls i.e. outside local boundaries of a city area. Enterprise Services Corporate – These services include internet services, broadband services, providing bandwidth and other network solutions to corporate customers. Other operations – These comprise the unallocated revenues, profits/(losses), assets and liabilities of the Group none of which constitutes a separately reportable segment. The corporate headquarters' expenses are not charged to individual segments. Notes: 1. Others represents the Unallocated Revenue, Profit/(Loss), Assets & Liabilities. 2. Segment results represents Profit/(Loss) before Finance Expenses and tax. 3. Capital expenditure pertains to gross additions made to fixed assets during the year. 4. Segment Assets include Fixed assets, Capital Work in Progress, Pre-operative Expenses pending allocation, Current Assets and Miscellaneous Expenditure to the extent not written off. 5. Segment Liabilities include Secured and Unsecured Loans, Current Liabilities and Provisions. 6. Inter segment Assets / Liabilities represent the inter segment account balances. 7. Inter segment revenues excludes the provision of telephone services free of cost among group companies. Others are accounted for on terms established by management on arm's length basis. These transactions have been eliminated in consolidation. 8. The accounting policies used to derive reportable segment results are consistent with those described in the "Significant Accounting Policies" note to the financial statements. Also refer Note 17 of Schedule 21.

5 Airtel main 98-148.p65 134 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 3 RelatedPartyDisclosures: 23. Bharti Airtel(Singapore) PrivateLimited Bharti AirtelHoldings(Singapore) PteLimited Network i2iLimited Bharti InfratelVenturesLimited Bharti InfratelLimited Bharti Airtel(Hongkong)Limited Bharti Airtel(Canada)Limited Bharti Airtel(UK)Limited Bharti InfratelLanka(Private)Limited Bharti AirtelLanka(Private)Limited Bharti Airtel(USA)Limited Bharti TelemediaLimited Bharti Airtel(Services)Limited Bharti AquanetLimited(mergedwithAirtelLtdw.e.f. January1,2009) 94,254,007 Bharti Hexacomlimited Subsidiary Companies 84,385,721 Name oftheRelatedPartyandRelationship Other RelatedParties Manoj Kohli 382,554,995 Akhil Gupta Sunil BhartiMittal 475,762,581 Key ManagementPersonnel: 243,338,746 List ofRelatedParties: description ofrelationships,asidentifiedandcertifiedbythemanagementare: 320,749,835 of therelatedpartieswherecontrolexistsand/orwithwhomtransactionshavetakenplaceduringyearand In accordancewiththerequirementsofAccountingStandards(AS)-18onRelatedPartyDisclosures,names CostincurredtoacquiresegmentassetspertaingrossadditionsmadeFixedAssets duringtheyear. 3. AssetsincludeFixedAssets,CapitalWorkinProgress,Investments,Deferred TaxAsset,CurrentAssets 2. Othersrepresentstheunallocatedrevenue,assetsandacquisition ofsegmentassetstheCompany. 1. Notes: Others Within India by geographicallocation Cost incurredduringtheyeartoacquiresegmentassets Others Within India Carrying amountofSegmentAssetsbygeographicallocation Others Within India geographical locationofcustomers(includingOtherIncome) Segment Revenuefromexternalcustomersbasedon Particulars the remainingportionbeingattributabletoothers,ispresentedbelow: relating totheGeographicalsegmentsinrespectofoperationswithinIndia,whichisonlyreportablesegment, The CompanyhasoperationswithinIndiaaswellwithentitieslocatedinothercountries.information Information aboutGeographicalSegment–Secondary and miscellaneousexpendituretotheextentnotwrittenoff. 135 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 9,9,3 389,946,486 491,099,935 259,393,677 341,550,270 4518097,089,308 2,835,301 94,581,880 10,196,159 7,391,491 15,337,354 16,054,931 20,800,435 sa Asat As at (Rs. ‘000) 135

BHARTI AIRTEL ANNUAL REPORT 2008-09 Entity having significant influence Singapore Telecommunications Limited Joint Venture/Joint Venture of Subsidiary Forum I Aviation Limited Indus Tower Limited Bridge Mobile Pte Limited Entities where Key Management Personnel exercises significant influence / Group Companies Comviva Technologies Limited (Formerly Bharti Telesoft Limited) Bharti Teletech Limited Bharti Tele-Ventures Employees Welfare Trust Bharti Wal-Mart Private Limited Bharti Enterprises Limited Bharti Retail Private Limited Bharti Foundation Bharti Electoral Trust Bharti Reatly Private Limited (Formerly Jasmine Projects Private Limited) Tamarind Projects Private Limited Bharti Telecom Limited Telecom (Seychelles) Limited Guernsey Airtel Limited Bharti Del Monte India Private Limited Primerose Projects Private Limited* Bharti AXA Life Insurance Co. Ltd Jersey Airtel Limited Centum Learning Limited (Formerly Bharti Learning System Limited) Jataayu Software Limited Bharti AXA General Insurance Co. Limited Bharti AXA Investment Managers Private Limited Bharti Teleports Limited

*Merged with Bharti Realty Private Ltd w.e.f January 9, 2008

5 Airtel main 98-148.p65 136 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65

Related Party Transaction for 2008-09 (Rs. ‘000) Nature of transaction Bharti Bharti Bharti Bharti Bharti Bharti Bharti Airtel Bharti Bharti Bharti Bharti Network Bharti Hexacom Airtel Airtel Airtel Airtel Airtel Holdings Airtel Telemedia Infratel Airtel Lanka i2i Aquanet Limited (Services) (USA) (UK) (Canada) (Hongkong) (Singapore) (Singapore) Limited Limited (Private) Limited Limited Limited Limited Limited Limited Limited Limited Pte Limited Limited Purchase of fixed assets/Bandwidth (60,269) (7,073) - - - - - (1,427,039) - (10,555) - (1,682,284) - Sale of fixed assets 1,491,733 408 ------5 - - -

137 Purchase of Investments (Mutual Fund) Sales of Investments (Mutual Fund) Rendering of services 3,659,324 5,379 659,829 12,720 3,751 - - 46,852 57,201 - - - 199 Receiving of services (1,228,856) (3,561,983) (74,510) (35,280) - (162) - - (16,539) (35,484,173) - (272,491) (80,282) Management fee (including service tax) 527,121 Fund transferred/includes expenses incurred on behalf of others 9,155,136 3,273,104 ------5,665,577 251,308 - - 43,255 Fund received/includes expenses incurred on behalf of Company (9,034,234) (3,214,358) ------(158,089) (40,701) - - (46,241) Employee related transaction incurred on behalf of others 33,649 2,611 ------13,892 - - - - Employee related transaction incurred on hehalf of Company (8,319) ------(95,700) (50) - - (33) Salary Donation ------Amount received on exercise of ESOP options Security deposit/Advances paid ------1,985,707 - - - Security deposit/Advances received ------Loan to Related Party ------12,544,332 2,471,450 - - Subscription to share capital 343,062 - - 13,093 - - 1,106,553 - - - 2,049,411 - - Interest received on fund transferred 266,820 - 3,374 986 225 - - - - 415,094 65,455 - - 7/21/2009, 9:23 PM

Closing balance 4,212,618 546,892 1,063,575 (25,643) 7,409 (162) - (1,380,187) 6,356,874 1,355,506 2,471,450 (4,557,444) - Unsecured Loan ------Creditors - - - (27,418) - (162) - (1,380,187) (27,417) (675,696) - (4,557,444) - Loans and Advances 1,722,565 - 76,306 1,775 3,570 0 - - 6,384,291 2,031,202 2,471,450 - - Debtors 2,490,053 546,892 987,269 - 3,839 ------

Closing Balance 4,212,618 546,892 1,063,575 (25,643) 7,409 (162) - (1,380,187) 6,356,874 1,355,506 2,471,450 (4,557,444) - Maximum Loans and Advances outstanding during the year 7,058,362 - 76,306 1,775 3,570 - - - 6,384,465 11,206,561 2,471,450 - Guarnatess and Collaterals 849,829 80,629 ------624,898 1,185 - - 137

BHARTI AIRTEL ANNUAL REPORT 2008-09 5 Airtelmain 98-148.p65

Related Party Transaction for 2008-09 (Rs. ‘000) Nature of transaction Bharti Singapore Forum I Bridge Indus Bharti Comviva Bharti Telecom Bharti Guernsey Tamarind Telecom Telecommu- Aviation Mobile Pte Towers Wal-Mart Technologies Teletech (Seychelles) Realty Airtel Projects Limited nications Limited Limited Limited Private Limited Limited Limited Private Limited Private Limited Limited Limited Limited

138 Purchase of fixed assets/Bandwidth ------(16,346) (1,045,101) - - - - Sale of fixed assets ------Purchase of Investments (Mutual Fund) Sales of Investments (Mutual Fund) Rendering of services - 1,549,602 - - - 1,039 20,178 102,419 15,064 - 4,165 - Receiving of services - (816,584) (34,753) (15,074) (9,786,743) - (690,394) (43,984) (12,434) (126,293) - - Management fee (including service tax) Fund transferred/includes expenses incurred on behalf of others ------1,327 - - - 14,622 Fund received/includes expenses incurred on behalf of Company ------(686) (5,737) - - - - Employee related transaction incurred on behalf of others ------54 - - - - Employee related transaction incurred on hehalf of Company ------Salary Donation ------Amount received on exercise of ESOP options Security deposit/Advances paid - - - - 544,237 - - - - 242,591 - - Security deposit/Advances received ------(53,600) - (188,991) - - Loan to Related Party Subscription to share capital ------Interest received on fund transferred - - 116 ------7/21/2009, 9:23 PM

Closing balance 9,078 531,594 - - (3,193,085) 381 (197,497) 25,857 738 611,418 10,160 - Unsecured Loan ------Creditors - - - - (3,737,322) - (197,497) - - - - - Loans and Advances 9,078 - - - 544,237 - - 25,857 738 611,418 10,160 - Debtors - 531,594 - - - 381 ------

Closing Balance 9,078 531,594 - - (3,193,085) 381 (197,497) 25,857 738 611,418 10,160 - Maximum Loans and Advances outstanding during the year 9,078 - - - 544,237 - - 25,857 738 611,418 10,160 Guarnatess and Collaterals ------5 Airtelmain 98-148.p65

Related Party Transaction for 2008-09 (Rs.’000) Bharti Bharti Bharti Bharti Jersey Bharti Centum Bharti Jataayu Bharti Bharti Bharti Sunil Akhil Manoj Nature of transaction Del Monte AXA Life Foundation Tele- Airtel Enterprises Learning Retail Software Axa General Axa Teleports Bharti Gupta* Kohli India Private insurance ventures Limited Limited Limited Private Ltd Insurance Investment Limited Mittal Limited Co. Ltd. Employee’s (Formerly Limited Co. Ltd Managers Welfate Trust Bharti Private Learning Limited 139 Systems Limited) Purchase of fixed assets/Bandwidth ------Sale of fixed assets ------8 ------Purchase of Investments (Mutual Fund) ------(1,210,027) - - - - Sales of Investments (Mutual Fund) ------911,887 - - - - Rendering of services - 23,887 - - 43,559 1,134 - 15,871 1,313 - - - Receiving of services - (51) - - (477) - (207,551) - - (10,076) - - Management fee (including service tax) Fund transferred/includes expenses incurred on behalf of others - - - - - 71 5,859 13,694 - - - - Fund received/includes expenses incurred on behalf of Company (447) - - - - (166,370) - (3,936) - (634) - - Employee related transaction incurred on behalf of others ------5,131 - - - - Employee related transaction incurred on hehalf of Company (1,034) - (3,079) - (365) (6,210) (1,036) (8,248) - - - - Salary ------228,977 21,489 25,958 Donation - - 103,079 ------Amount received on exercise of ESOP options - - - (11,679) ------Security deposit/Advances paid ------Security deposit/Advances received ------Loan to Related Party ------Subscription to share capital ------14,700 - - - Interest received on fund transferred ------7/21/2009, 9:23 PM

Closing balance 447 23,740 - 107,364 31,672 470 62,610 5,648 230 - - - (110,000) (7,933) (7,989) Unsecured Loan ------Creditors ------(110,000) (7,933) (7,989) Loans and Advances 447 23,740 - 107,364 31,672 470 62,610 5,648 230 ------Debtors ------

Closing Balance 447 23,740 - 107,364 31,672 470 62,610 5,648 230 - - (110,000) (7,933) (7,989) Maximum Loans and Advances outstanding during the year 447 23,740 - 107,364 31,672 470 62,610 5,648 230 Guarnatess and Collaterals ------

*Ceased to be joint Managing Director with effect from August 1, 2008 139

BHARTI AIRTEL ANNUAL REPORT 2008-09 5 Airtelmain 98-148.p65

Related Party Transaction for 2007-08 (Rs. ‘000) Nature of transaction Bharti Bharti Bharti Bharti Bharti Bharti Bharti Bharti Bharti Bharti Bharti Network Singapore Hexacom Aquanet Airtel Airtel Airtel Airtel Airtel Airtel Telemedia Infratel Airtel Lanka i2i Tele- Limited Limited (Services) (USA) (UK) (Canada) (Hongkong) (Singapore) Limited Limited (Private) Limited communications Limited Limited Limited Limited Limited Pvt. Limited LimitedLimited

140 Purchase of fixed assets (101,535) - (8,150) ------(37,737) - (1,553,399) - Sale of fixed assets 443,597 - 5,700 ------939 - - - Rendering of services 2,725,095 - 308,901 ------1,164,107 Receiving of services (527,124) (57,314) (2,166,532) (15,708) (4,286) - - - - (6,376,928) - (174,811) (1,960,328) Fund transferred/includes expenses incurred on behalf of others 3,583,664 28,593 1,275,666 56,760 904 - - - 865,045 23,627,117 634,913 - 79,265 Fund received/includes expenses incurred on behalf of Company (1,790,346) (57,266) (1,169,076) (12,871) - (240) - - -(17,863,812) (280) (527,604) (850,013) Employee related transaction incurred on behalf of others 6,698 - 25,740 - - - - - 25,486 117 - - - Employee related transaction incurred on hehalf of Company (1,685) ------Salary ------Donation ------Amount received on exercise of ESOP options ------Purchase of shares of Subsidiary Companies - - (40,902) ------(2,658,020) Subscription to share capital - - - (404,514) (31,773) - (18,148) (20,139) ---- - Interest charged on funds transferred (143,440) ------(335,115) - - - 7/21/2009, 9:23 PM

Closing balance 3,338,780 (11,450) 990,327 342,912 (3,382) (240) - - 890,531 1,091,484 634,633 (2,170,746) 110,279 Unsecured Loan ------(527,604) - Creditors - (11,450) - - (3,382) (240) - - - - - (1,643,142) - Loans and Advances 1,876,253 - - 342,912 - - - - 864,000 1,091,484 634,633 - - Debtors 1,462,527 - 990,327 - - - - - 26,531 - - - 110,279

Closing Balance 3,338,780 (11,450) 990,327 342,912 (3,382) (240) - - 890,531 1,091,484 634,633 (2,170,746) 110,279 Maximum Loans and Advances outstanding during the year 1,937,346 - - 342,912 - - - - 890,531 17,345,093 634,633 - - Guarentees and Collaterals 339,749 20,000 135,134 - - - - - 545,310 4,055 - - - 5 Airtelmain 98-148.p65

Related Party Transaction for 2007-08 (Rs. ‘000) Nature of transaction Forum I Bridge Bharti Comviva Bharti Jasmine Tamarind Bharti Bharti Bharti Bharti Bharti Bharti Manoj Aviation Mobile Pte Wal-Mart Techno- Teletech Projects Projects Foun- Enterprises Retail Electoral Tele- Venture- Kohli Limited Limited Private logies Limited Private Private dation Limited Private Trust Ventures tech Limited Limited Limited Limited Limited Employees’ Limited Welfare Trust

Purchase of141 fixed assets - - - (14,179) (1,543,689) - - - - - Sale of fixed assets ------15,642 - - - - - Rendering of services - - 681 4,524 5,939 - - - 31 202 - - - - Receiving of services (27,131) - - (556,707) (89,785) (52,486) (8,666) ------Fund transferred/includes expenses incurred on behalf of others - 2,970 - - 53,607 189,122 - - 3,263 1,998 - - - - Fund received/includes expenses incurred on behalf of Company (5,800) - - - (77) - - - (36,586) (1,994) Employee related transaction incurred on behalf of others - - 454 - - 1,222 - - - 5,085 - - - - Employee related transaction incurred on Behalf of Company - - - - - (440) - - (15,873) (10,463) - - - - Salary ------32,087 Donation ------104,441 - - 200,000 - - - Amount received on exercise of ESOP options ------(14,750) - - Purchase of shares of Subsidiary Companies ------(2,658,020) - Subscription to share capital - (48,474) ------Interest charged on funds transferred 580 ------

Closing balance (1,685) - 147 3,252 (50,515) 523,791 - - 13,015 (3,197) - 119,043 - Unsecured Loan -

7/21/2009, 9:23 PM Creditors (1,685) - - - (50,515) ------Loan and Advances - - - 3,252 - 523,791 - - 12,900 - - 119,043 - - Debtors - 147 - - - - 115 (3,197) - - - -

Closing Balance (1,685) - 147 3,252 (50,515) 523,791 - - 13,015 (3,197) - 119,043 - - Maximum Loans and Advances outstanding during the year - - - 3,252 - 523,791 - - 12,900 - - 119,043 - - Guarantees and Collaterals ------141

BHARTI AIRTEL ANNUAL REPORT 2008-09 24. Operating lease - As a Lessee The lease rentals charged during the year for cancelable/non-cancelable leases relating to rent of building premises and cell sites as per the agreements and maximum obligation on long-term non-cancelable operating leases are as follows: (Rs. ‘000) Particulars As at As at March 31, 2009 March 31, 2008 Lease Rentals 34,257,208 11,648,029

Obligations on non cancelable leases : Not later than one year 30,102,470 9,371,291 Later than one year but not later than five years 75,778,742 38,693,887 Later than five years 136,829,016 105,693,775 Total 242,710,228 153,758,953 The escalation clause includes escalation at various periodic levels ranging from 0 to 50%, includes option of renewal from 1 to 99 years and there are no restrictions imposed on lease arrangements. Operating Lease – As a Lessor i) The Company has entered into a non-cancelable lease arrangement to provide approximately 100,000 Fiber pair kilometers of dark fiber on indefeasible right of use (IRU) basis for a period of 18 years. The lease rental receivable proportionate to actual kilometers accepted by the customer is credited to the Profit and Loss Account on a straight - line basis over the lease term. Due to the nature of the transaction, it is not possible to compute gross carrying amount, depreciation for the year and accumulated depreciation of the asset given on operating lease as at March 31, 2009 and accordingly, disclosures required by AS 19 is not provided. ii) The future minimum lease payments receivable are: Future minimum lease payments received are (Rs. ‘000) Particulars As at As at March 31, 2009 March 31, 2008 Not later than one year 164,081 7,802 Later than one year but not later than five years 481,121 51,891 Later than five years 554,772 - Total 1,199,974 59,693 25. Finance Lease - as a Lessee The Company entered into a composite IT outsourcing agreement, whereby the vendor supplied fixed assets and IT related services to the Company. Based on the risks and rewards incident to the ownership, the fixed asset and liability are recorded at the fair value of the leased assets at the time of receipt of the assets, since it is not possible for the Company to determine the extent of fixed assets and services under the contract at the inception of the contract. These assets are depreciated over their useful lives as in the case of the Company's own assets. Since the entire amount payable to the vendor towards the supply of fixed assets and services during the year is accrued, the disclosures as per AS 19 are not applicable. There are no restrictions imposed on lease arrangements.

5 Airtel main 98-148.p65 142 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 7 Employeestockcompensation 27. 26. i)Allaboveoptionsareplannedtobesettledinequityatthetimeofexerciseandhavemaximumperiod7 (iv) 546,980 Less:TransferundertheSchemeofArrangement (v) 1,406,883 Foreignexchangefluctuationand MTMlosseschargedinfinancial (iv) Otherexpensesclaimedas deductioninthefinancialstatement (iii) Depreciationclaimedasdeductionunderthe (ii) e eerdTxAst/Laiiis 3, Pursuanttotheshareholders'further (iii) OnAugust31,2001andSeptember28,2001,theCompanyissuedatotalof1,440,000equitysharesat (ii) Pursuanttotheshareholders'resolutionsdatedFebruary27,2001andSeptember25,2001,Company (i) enacted taxrateforIndiancompaniesundertheIncomeTaxAct,1961. The taximpactfortheabovepurposehasbeenarrivedatbyapplyingarateof33.99%beingsubstantively Net DeferredTaxAssets/(Liabilities) Add:Acquired under theSchemeofMerger (vi) Provisionfordoubtfuldebts/advancescharged (i) Deferred TaxAssets/(Liabilities)arisingfrom: Particulars The breakupofnetDeferredTaxAsset/(Liability)asonMarch31,2009isfollows: )2001PlanundertheOldScheme a) years fromthedateofrespectivegrants.Theplansexistingduringyearareasfollows: of theirperformanceandothereligibilitycriteria. of optionswasdeterminedat9,367,276tobegrantedemployeesfromtimeonthebasis Employee StockOptionScheme(hereinaftercalled"theNewScheme")underwhichthemaximumquantum 695,095 (Refer Note2(b)ofSchedule22) 4,892,398 future years(bywayofdepreciationandactualrealisation,respectively) statement butallowedasdeductionundertheIncomeTaxActin on actualpayment(Net) but allowedasdeductionunderIncomeTaxActinfutureyear but chargeableinthefinancialstatementsfutureyears in futureyears(totheextendconsideredrealisable) statement butallowedasdeductionundertheIncomeTaxAct RfrNt ()o ceue 2 184 - shares allottedtothetrustincreased15,840,000equityshares. shares foreveryoneequityshareheldasatSeptember30,2001,aresultofwhichthetotalnumber a priceofRs565perequitysharetotheTrust.TheCompanyissuedbonussharesinratio10 (1,874) performance andothereligibilitycriteria. and itssubsidiaries.ThegrantofoptionstotheemployeesunderESOPSchemeisonbasistheir under whichtheCompanydecidedtogrant,fromtimetime,optionsemployeesof introduced the"BhartiTele-VenturesEmployees'StockOptionPlan"(hereinaftercalled"theOldScheme") 22) Schedule of 2(b) Note (Refer f4 ots ncmlto f2 ots20% 15% 10% Oncompletion of24months 30% 15% 20% Oncompletion of18months Oncompletionof12months of 48months: For optionswithavestingperiod Oncompletion of24months Oncompletionof 12months Oncompletionof12months of 42months: For optionswithavestingperiod period of36months: For optionswithavesting follows: The optionsunderthisplanhaveanexercisepriceofRs 22.50 pershareandvestonagradedbasisas 143 resolution datedSeptember6,2005,theCompanyannouncedanew ncmlto f3 ots30% 40% 30% 50% On completionof36months On completionof42months On completionof30months On completionof36months ncmlto f4 ots40% On completionof48months Income TaxAct nfnnilin financial Vesting period from Vesting schedule Vesting Vesting periodfrom the grantdate 7/21/2009, 9:23 PM (972 (32,375) (79,772) ac 1 09March31,2008 March 31,2009 70344 (7,063,454) 4,116,922 7,0 (638,684) 271,103 sa Asat As at (4,969,269) 3,120,885 (Rs. ‘000) 143

BHARTI AIRTEL ANNUAL REPORT 2008-09 b) 2004 Plan under the Old Scheme. The options under this plan have an exercise price of Rs. 70 per share and vest on a graded basis as follows: Vesting period from Vesting schedule the grant date For options with a vesting period On completion of 12 months 10% of 48 months: On completion of 24 months 20% On completion of 36 months 30% On completion of 48 months 40% c) Super-pot Plan under the Old Scheme The options under this plan have an exercise price of Rs. Nil per share and vest on a graded basis as follows: Vesting period from Vesting schedule the grant date For options with a vesting period On completion of 12 months 30% of 36 months: On completion of 24 months 30% On completion of 36 months 40% d) 2006 Plan under the Old Scheme The options under this plan have an exercise price of Rs. 10 per share and vest on a graded basis from the effective date of grant as follows: Vesting period from Vesting schedule the grant date For options with a vesting period On completion of 36 months 50% of 48 months: On completion of 48 months 50% e) 2005 Plan under the New Scheme The options under this plan have an exercise price in the range of Rs. 221 to Rs. 922 per share and vest on a graded basis from the effective date of grant as follows: Vesting period from Vesting schedule the grant date For options with a vesting period On completion of 12 months 10% of 48 months: On completion of 24 months 20% On completion of 36 months 30% On completion of 48 months 40% f) 2008 Plan and Annual Grant Plan (AGP) under the New Scheme The options under this plan have an exercise price in the range of Rs. 590 to Rs. 673 per share and vest on a graded basis from the effective date of grant as follows: 2008 AGP Plan Vesting period from Vesting Vesting the grant date schedule schedule For options with a vesting period On completion of 12 months 25% 33% of 36 months: On completion of 24 months 35% 33% On completion of 36 months 40% 33%

5 Airtel main 98-148.p65 144 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 rne - -- - - 50 - - 22.50 - 11 131 7 0.00 22.50 19 22.50 AsofMarch31, 37 Outstanding attheyearend Cancelled orexpired Exercised* Granted Outstanding atbeginningofyear Number ofsharesunderoption: AsofMarch31, 2001 Plan Thousands) in (Shares Theinformationconcerningstockoptionsgranted,exercised,forfeitedandoutstandingattheyear-end (v) rne - - - - 70 - - 70.00 - - 189 755 - 22.50 1.76 70.00 - 37 289 70.00 478 Outstanding attheyearend expired or Cancelled Exercised* 22.50 - Granted Outstanding atbeginningofyear 19 Number ofsharesunderoption: 2004 Plan than marketvalue - granted duringtheyear/periodatless exercise priceperoptionforoptions Weighted averagegrantdatefairvalue/ Exercisable atendofyear rne ------3.25 17 - 2 - 6 - - 6 - - 2.25 25 ------6 Outstanding atbeginningofyear 70.00 Number ofsharesunderoption: 6 - 2006 Plan 478 - than marketvalue - granted duringtheyear/periodatless exercise priceperoptionforoptions Weighted averagegrantdatefairvalue/ 6 Exercisable atendofyear Outstanding attheyearend expired or Cancelled Exercised* 70.00 Granted - Outstanding atbeginningofyear 289 Number ofsharesunderoption: Superpot Plan than marketvalue - granted duringtheyear/periodatless exercise priceperoptionforoptions Weighted averagegrantdatefairvalue/ Exercisable atendofyear Granted - - 1,863 851.47 1,863 - - - - 287.66 141 3,020 - 474.60 - 3,841 18 10.00 Granted Outstanding atbeginningofyear 34 300 Number ofsharesunderoption: 10.00 Scheme 2005 at lessthanmarketvalue 1,205 options grantedduringtheyear/period value/exercise priceperoptionfor Weighted averagegrantdatefair Exercisable atendofyear Outstanding attheyearend Cancelled orexpired Exercised* rne 10 130 Granted is asfollows: 145 ubro We Number of pin xriermiigotoseecs remaining exercise options remaining exercise options tc vrg average average stock 3.7 2.0304 645.14 300.47 526.50 130.47 ,9 10.00 1,393 price (Rs.) gtdWihe ubrWihe Weighted Weighted Number Weighted ighted 092008 2009 2.0 422.50 44 22.50 00 0 70.00 207 70.00 00 7- 10.00 17 300 10.00 10.00 contractual i er)(inYears) (in Years) .7t .5 ,9 00 5.58 10.00 1,393 5.07 to5.35 7/21/2009, 9:23 PM o32 3 25 0. 22.50 37 to 3.25 o22 487.02. 70.00 478 to 2.25 ielife life of stock ,5 10.00 1,251 price (Rs.) vrg average average contractual 25 to4.25 76 to3.25 145

BHARTI AIRTEL ANNUAL REPORT 2008-09 As of March 31, As of March 31, (Shares in Thousands) 2009 2008 Number of Weighted Weighted Number Weighted Weighted stock average average of stock average average options exercise remaining options exercise remaining price (Rs.) contractual price (Rs.) contractual life life (in Years) (in Years)

Exercised 239 268.16 249 249.51 Cancelled or expired 603 - 793 - Outstanding at the year end 2,999 474.60 3.44 to 5.92 3,841 474.60 4.44 to 6.92 Exercisable at end of year 938 474.60 289 474.60 Weighted average grant date fair value/ - - 1,863 345.79 exercise price per option for options granted during the year/period at less than market value Scheme 2008 & Annual Grant Plan Number of shares under option: Outstanding at beginning of period - - - - Granted 3,108 660.72 - - Exercised - - - - Cancelled or expired 211 - - - Outstanding at period end 2,897 662.44 - - - Exercisable at end of period - - - - Weighted average grant date fair 3,108 308.87 - - value/exercise price per option for options granted during the year/period at less than market value *Options have been exercised out of the shares issued to the trust The weighted average share price during the year was Rs. 733.62 (vi) The fair value of the options granted was estimated on the date of grant using the Black-Scholes/Lattice valuation model with the following assumptions For the For the year ended year ended Particulars March 31, 2009 March 31, 2008 Risk free interest rates 4.45% to 9.70% 6.45% to 8.25% Expected life 48 to 60 months 48 to 66 months Volatility 36.23% to 41.39% 40.09% to 41.33% Dividend yield 0.00% 0.00% Wtd average share price on the date of grant 616.80 to 832.55 719.95 to 946.90 The volatility of the options is based on the historical volatility of the share price since the Company's equity shares became publicly traded, which may be shorter than the term of the options. (vii) The balance of deferred stock compensation as on March 31, 2009 is Rs. 824,092 thousand (March 31, 2008 Rs. 687,353 thousand) and total employee compensation cost recognized for the year then ended is Rs. 646,967 thousand (March 31, 2008 Rs. 324,500 thousand). 28. Earnings per share: (Basic & Dilutive) As at As at Particulars March 31, 2009 March 31, 2008 Nominal value of equity shares (Rs.) 10 10 Weighted average number of equity shares outstanding during the year 1,898,105,039 1,897,378,958 Dilutive effect on weighted average number of equity shares outstanding during the year* 565,047 1,549,696 Weighted average number of equity shares and equity equivalent shares for computing Diluted EPS 1,898,670,086 1,898,928,654

* Diluted effect on weighted average number of equity shares and profit attributable is on account of Foreign Currency Convertible Bonds and Employee Stock Option Plan (ESOP).

5 Airtel main 98-148.p65 146 7/21/2009, 9:23 PM 5 Airtelmain 98-148.p65 9 ForwardContracts&DerivativeInstruments 29. 33. 32. 31. 30. ForLoanrelatedexposures* A The followingtabledetailsthestatusofCompany’sexposureasonMarch31,2009: foreign exchangefluctuations. exchange contracts,Optioncontractsandinterestrateswapstomanageitsexposures currency exchangeratesandinterestrates.TheCompanyusesderivativefinancialinstrumentssuchasforeign The Company'sactivitiesexposeittoavarietyoffinancialrisks,includingtheeffectschangesinforeign Previous yearfigureshavebeen regrouped/reclassifiedwherenecessarytoconformcurrent year'sclassification. Pte LimitedandBhartiAirtel (UK)Limited. Limited, BhartiTelemediaAirtel(Singapore) PrivateLimited,BhartiAirtelHoldings(Singapore) Bharti Airtel(USA)Limited,(Canada) BhartiAirtelHongkongLimited,InfratelVentures The Companyhasundertakentoprovidefinancialsupport, toitssubsidiariesBhartiAirtelServicesLimited, Annual GeneralMeetingoftheCompany. face value)forfinancialyear2008-09.Thepaymentissubject totheapprovalofshareholdersinensuing The BoardofDirectorsrecommendedafinaldividend Rs.2.00perequityshareof10.00each(20% equity sharesofRs.10eachinto2 5each,subjecttotheapprovalofitsshareholders. The BoardofdirectorsinitsmeetingheldonApril29,2009 haveapprovedsub-division(sharesplit)ofexisting (including lossofRs1,230,080thousandtowardsembedded derivatives). towards embeddedderivatives)(March31,2008recordedMarkedtoMarketlossofRs.2,044,991thousand the yearendedMarch31,2009(includingreversaloflossesrecognisedinearlierperiodsRs.1,230,080thousand marked-to-market basisandhasrecordedreversalsoflossesforearlierperiodRs.1,835,399thousand The Companyhasaccountedforderivatives,whicharecoveredundertheAnnouncementissuedbyICAI,on asset wouldhavebeenlowerbyRs.3,562,639thousand. March 31,2008),andnetfixedassetswouldhavebeenhigherbyRs.16,359,617thousanddeferredtax thousand foryearendedMarch31,2009(lowerbyRs.2,923,206the Had theCompanycontinuedwithitsearlierpolicy,netprofitaftertaxwouldhavebeenhigherbyRs.12,550,657 credited suchfluctuationsdirectlytotheProfit&LossAccount. such fluctuation,asperpolicyhithertofollowed,theCompanyhas,witheffectfromApril1,2008,charged/ (Accounting Standard)Rules2006('asamended')datedDecember7,2006.Insteadofcapitalizing/decapitalizing Accounting Standard(AS-11)"EffectofChangesinForeignexchangeRates"notifiedunderCompanies legal advice.Duringtheperiod,effectiveApril1,2008,Companyhasadoptedtreatmentprescribedin fixed assetstillJune30,2008,aspertherequirementofScheduleVICompaniesAct,1956basedona The Companyhadfollowedtheaccountingpolicytoadjustforeignexchangefluctuationonloans/liabilityfor Allderivativesaretakenforhedging purposesonlyandtraderelatedexposureincludeshedgestakenfor * ForTraderelatedexposures* B S. No. negdfrincrec aals2,7,2 12,951,335 25,052,788 - 28,273,925 34,834,314 - receivables currency foreign Unhedged E Unhedgedforeigncurrencypayables D Unhedgedforeigncurrencyborrowing C forecasted receivables. )Otos1,8,8 13,566,374 47,865,985 20,181,708 16,087,384 58,581,419 12,572,404 InterestRateSwaps c) Options b) Forwards a) )Otos54952,687,125 3,197,778 534,975 5,347,203 Options b) Forwards a) oa 7212681,614,067 87,241,206 (March Total Particulars oa ,8,7 5,884,903 5,882,178 Total 147 oinlVleNotionalValue Notional Value 7/21/2009, 9:23 PM 1 09 (March31,2008) 31, 2009) (Rs. ’000) 147

BHARTI AIRTEL ANNUAL REPORT 2008-09 Balance Sheet Abstract and Company’s General Business Profile

I Registration Details

Registration No. 70609 State Code 55 Balance Sheet Date 31 - 03 - 2009 II Capital raised during the year (Amount in Thousands) Public Issue Rights Issue NIL NIL Bonus Issue Private Placement NIL NIL III Position of mobilisation and deployment of funds (Amount in Thousands) Total Liabilities Total Assets 353576115 353576115 Sources of funds Paid up Capital Reserves & Surplus 18982398 256295074 Secured Loans Unsecured Loans 517304 76619167

Share Application Money Deffered Tax Liabilities (Net) Pending Allotment 2933 1159239

Net Fixed Assets Investments Application of funds 275800278 117777582

Net Current Assets Micscellaneous Expenditure ( 43273721 ) 873

Deferred Tax (Net) 3271103 IV Performance of the Company (Amount in Thousands) Turnover Total Expenditure 340142902 259934903 Profit / (Loss) Before Tax Profit / (Loss) After Tax 81615367 77438385 Earning per Share in Rs. Dividend Rate 40 . 80 20% V Generic names of three principal products / services of the company (as per monetary terms) Item code No. (ITC code) NOTAP P L I CAB L E

Product Description BASIC AND CELLULAR TELEPHONE SERVICES, BROAD-BAND & LONG DISTANCE COMMUNICATION SERVICES

For and on behalf of the Board Sunil Bharti Mittal Manoj Kohli Chairman and Managing Director CEO & Joint Managing Director

Place : New Delhi Srikanth Balachander Vijaya Sampath Date : April 29, 2009 Chief Financial Officer Group General Counsel & Company Secretary

5 Airtel main 98-148.p65 148 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 17 .Wereportthatconsolidatedfinancialstatements 3. Weconductedourauditinaccordancewithauditing 2. WehaveauditedtheattachedConsolidatedBalance 1. Consolidated Auditors’ Report at March31,2009ofRs.23,842,291thousands herein withtheCompany’sshareoftotalassetsas the financialstatementsofajointventure,included consolidated financialstatements,wedidnotaudit Rules, 2006(asamended).Inrespectofthe pursuant totheCompanies(AccountingStandards) Consolidated FinancialStatementsasnotified Accounting forInvestmentsinAssociates Joint VenturesandAccountingStandards(AS)23, Standard (AS)27,FinancialReportingofInterestin 21, ConsolidatedFinancialStatements,Accounting the requirementofAccountingStandards(AS) have beenpreparedbytheGroupinaccordancewith reasonable basisforouropinion. presentation. Webelievethatourauditprovidesa well asevaluatingtheoverallfinancialstatement and significantestimatesmadebymanagement,as includes assessingtheaccountingprinciplesused disclosures inthefinancialstatements.Anauditalso test basis,evidencesupportingtheamountsand misstatement. Anauditincludesexamining,ona financial statementsarefreeofmaterial to obtainreasonableassuranceaboutwhetherthe Standards requirethatweplanandperformtheaudit standards generallyacceptedinIndia.Those based onouraudit. express anopiniononthesefinancialstatements Group’s management.Ourresponsibilityisto financial statementsaretheresponsibilityof year endedonthatdateannexedthereto.These and theConsolidatedCashFlowStatementfor and alsotheConsolidatedProfitLossAccount in Note3onschedule21]asatMarch31,2009 [together referredtoasthe‘theGroup’described its subsidiaries,jointventuresandassociate Sheet ofBhartiAirtelLimited(’theCompany)and Auditors’ ReporttoTheBoardofDirectorsBhartiAirtelLimited 149 FinancialStatementswith ae:April : Date NewDelhi : Place Membership No.:93283 Partner per PrashantSinghal Chartered Accountants For S.R.BATLIBOI&ASSOCIATES Basedonourauditandconsiderationofreport 4. )incaseoftheconsolidatedcashflowstatement, c) incaseoftheconsolidatedprofitandloss b) incaseoftheconsolidatedbalancesheet, a) India: with theaccountingprinciplegenerallyacceptedin statements giveatrueandfairviewinconformity the opinionthatattachedconsolidatedfinancial according totheexplanationgivenus,weareof Venture andtothebestofourinformation and ontheotherfinancialinformationofJoint of otherauditorsontheseparatefinancialstatements such otherauditors. financial statementsisbasedsolelyonthereportof the extenttheyhavebeenderivedfromsuch to us,andouropinionontheyeardateresults, by otherauditorswhosereporthasbeenfurnished and otherfinancialinformationhavebeenaudited thousands, respectively.Thesefinancialstatements Rs. 8,929,186thousandsand726,254 and netrevenuelossfortheyearthenendedof date. of thecashflowsforyearendedonthat date; and account, theprofitforyearendedonthat 2009; the stateofaffairGroupasatMarch31, 7/21/2009, 9:23 PM 29, 2009 149

BHARTI AIRTEL ANNUAL REPORT 2008-09 Consolidated Balance Sheet as at March 31, 2009

Particulars Schedule As at As at No. March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SOURCES OF FUNDS Shareholder’s Funds Share Capital 1 18,982,398 18,979,074 Share Application Money Pending Allotment 2,933 12,318 Employee Stock Options Outstanding 2,901,620 1,251,370 Less: Deferred Stock Compensation 1,495,823 1,405,797 687,353 564,017 (Refer Note 22 on Schedule 21 and Note 19 on Schedule 22) Reserves and Surplus 2 270,888,116 197,688,417 Loan Funds Secured Loans 3 14,287,304 582,598 Unsecured Loans 4 120,884,165 95,434,870 Deferred Tax Liability (Net) (Refer Note 14 on Schedule 21 and Note 18 on Schedule 22) – 2,729,149 Minority Interest 12,297,540 10,142,236 (Refer Note 2 on Schedule 21 and Note 9 on Schedule 22) Total 438,748,253 326,132,679 APPLICATION OF FUNDS Fixed Assets Gross Block 5 586,616,050 423,224,108 Less: Depreciation 147,129,637 97,729,655 Net Block 439,486,413 325,494,453 Capital Work-in-Progress 41,436,526 35,699,610 480,922,939 361,194,063 Investments 6 23,489,524 48,097,075 Deferred Tax Asset (Net) 292,978 – (Refer Note 14 on Schedule 21 and Note 18 on Schedule 22) Current Assets, Loans and Advances Inventory 7 962,676 1,142,295 Sundry Debtors 8 28,997,771 28,398,245 Cash and Bank Balances 9 27,659,715 7,034,067 Other Current Assets 10 1,552,235 1,004,881 Loans and Advances 11 60,534,722 27,486,641 119,707,119 65,066,129 Less: Current Liabilities and Provisions 12 Current Liabilities 168,621,781 141,323,352 Provisions 17,043,399 6,903,270 185,665,180 148,226,622 Net Current Assets (65,958,061) (83,160,493) Miscellaneous Expenditure (To the extent not written off or adjusted) 13 873 2,034 Total 438,748,253 326,132,679 Statement of Significant Accounting Policies 21 Notes to the Financial Statements 22

As per our report of even date The Schedules referred to above and Notes to the financial statements form an integral part of the Balance Sheet For S.R. BATLIBOI & ASSOCIATES For and on behalf of the Board of Directors of Bharti Airtel Limited Chartered Accountants per Prashant Singhal Sunil Bharti Mittal Manoj Kohli Partner Chairman and Managing Director CEO & Joint Managing Director Membership No: 93283 Place : New Delhi Vijaya Sampath Srikanth Balachander Date : April 29, 2009 Group General Counsel & Company Secretary Chief Financial Officer

6 Consolidated - Airtel 149-192.p65 150 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 per Prashant Singhal Sunil Bharti Mittal Manoj Kohli Manoj Cha SunilBhartiMittal The SchedulesreferredtoaboveandNotesthefinancialstatements New : Place Membership No:93283 Partner Singhal Prashant per Chartered Accountants For S.R.BATLIBOI&ASSOCIATES As per our report of even date ae: Date Profit beforeTax annsprsaei s Dltd 13 34.19 34.23 120,157,916 41.39 41.40 55,790,402 188,310,180 120,157,916 Earnings pershareinRs.(Diluted) Earnings pershareinRs.(Basic) Profit carriedtoBalanceSheet Profit broughtforward(ReferSchedule2) Profit fortheyear 140,917,501 Profit afterTax 191,128,128 Depreciation, Amortisation,CharityandDonationTaxation Profit beforeOtherIncome,FinanceExpenses(Net), expenditure, CharityandDonationTaxation (Net), Depreciation,Amortisation,Pre-operative Profit beforeLicenceFee,OtherIncome,FinanceExpenses EXPENDITURE oe oteFnnilSaeet 22 21 Notes totheFinancialStatements Statement ofSignificantAccountingPolicies (Refer Note19onSchedule21and2022) Schedule INCOME Particulars Consolidated for theyearendedMarch31,2009 hrt n oain2011317,416 220,141 34,714,180 388,208 46,727,692 2,324,209 35,102,388 49,051,901 - DeferredTax (March31,2008Rs.959,169thousand)] [IncludesTaxofNilthousandforearlieryears - CurrentTax Tax Expenses earlier years(March31,2008Rs.326,623thousand)] [Includes MATcreditofRs.1,364,058thousandfor MAT credit Charity andDonation Amortisation on Schedule22) Restructuring asperScheme(ReferNote2(b) Less :AmountwithdrawnfromReserveforBusiness Depreciation/ Amortization Finance Expense(Net) Other Income rnfre oGnrlRsre60000– – 402,986 1,000,163 413,623 6,000,000 1,852,275 408,131 3,796,480 4,411 Tax onDividend Proposed DividendonEquityShares Transferred toGeneralReserve 41,111,353 Transferred fromDebentureRedemptionReserve Note 9onSchedule22) Minority Interest(ReferNote2onSchedule21and 26,899,638 - FringeBenefitTax 268,727,942 52,908,719 38,269,861 372,328,114 Licence feeandSpectrumcharges(revenueshare) Administrative andOther Sales andMarketing Personnel Cost ofGoodsSold Network Operating Access Charges Sale ofGoods Service Revenue (ReferNote14onSchedule21and1822) April 29, 2009 Group General Counsel & Company Secretary Chief Financial Officer Financial Chief GroupGeneralCounsel &CompanySecretary April 29,2009 Delhi 151 ra n aaigDrco CEO&JointManaging Director irman andManagingDirector ProfitandLossAccount iaaSmahSrikanthBalachander Sampath Vijaya o ac 1 09March31,2008 March31,2009 No. ForandonbehalfoftheBoardDirectorsBhartiAirtelLimited 20 19 18 17 16 15 14 o h ereddFortheyearended For theyearended form anintegralpartoftheProfit&LossAccount 7/21/2009, 9:23 PM 5,5,6 114,017,863 152,858,267 8,9,8 129,204,915 182,392,682 270,122,416 373,520,810 30216 (1,196,238) (398,625) (3,022,126) (2,317,983) 040289,353,297 73,115,474 10,400,288 85,910,130 862885,278,690 18,612,828 8595563,953,891 64,954,054 78,589,545 80,441,820 8122464,367,514 68,152,264 20,733,347 19,350,109 14,391,554 32,429,543 24,522,970 24,611,665 17,022,941 62,327,850 R.‘0)(Rs.‘000) (Rs. ‘000) ,1,9 3,388,183 2,796,080 2,911,290 1,523,814 ,9,9 1,394,474 1,192,696 4,1 – 645,212 1,189,009 998,537 151

BHARTI AIRTEL ANNUAL REPORT 2008-09 Cash Flow Statement for the year ended March 31, 2009

Particulars For the year ended For the year ended March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

A. Cash flow from operating activities: Net profit before tax 85,910,130 73,115,474 Adjustments for: Depreciation 46,727,692 34,714,180 Interest Expense and other Finance Charges 5,030,519 3,859,697 Interest Income (1,858,591) (221,604) (Profit)/Loss on Sale of Assets (Net) 25,735 64,827 (Profit)/Loss on sale of Investments (2,592,369) (582,609) Amortisation of ESOP Expenditure 894,878 336,533 Lease Equalisation / FCCB Premium 1,161,147 1,876,145 Amortisation of Goodwill 800,355 568,535 Provision for Deferred Bonus 439,024 (125,287) Licence fee Amortisation 1,217,408 1,289,786 Bad Debts/Advances Written off 815,967 2,022,676 Provision for Bad and Doubtful Debts/Advances (Net of write back) 3,002,326 1,216,992 Liabilities/Provisions no longer required written back (577,057) (386,639) Provision for Gratuity and Leave Encashment 362,092 262,184 Provision for Inventory for obsolete/Damaged stock 519,726 43,113 Unrealized Foreign Exchange (gain)/loss 15,393,148 17,950 Provision for Warranty (4,470) 5,265 Loss from swap arrangements 65,433 97,562 Provision for Wealth Tax (Net) 540 (349) Operating profit before working capital changes 157,333,633 118,174,431 Adjustments for changes in working capital : - Increase in Sundry Debtors (4,817,031) (12,219,709) - Increase in Other Receivables (24,816,570) (10,984,098) - Increase in Inventory (340,107) (273,266) - Increase in Trade and Other Payables 22,593,840 37,867,835 Cash generated from operations 149,953,765 132,565,193

Taxes (Paid)/Received (12,838,132) (9,321,148) Net cash from operating activities 137,115,633 123,244,045

B. Cash flow from investing activities:

Purchase of fixed assets (168,589,591) (136,375,742) Proceeds from Sale of fixed assets 1,868,859 1,607,330 Proceeds from Sale of Investments 420,787,078 175,342,365 Purchase of Investments (393,572,466) (221,274,149) Dilution in Equity of Subsidiary Company 1,186,499 – Interest Received 1,362,657 259,396 Purchase of Fixed Deposits (with maturity more than three months) (14,915,200) – Proceeds from Maturity of Fixed Deposits (with maturity more than three months) 300,000 500,000 Acquisition/ Subscription/Investment in Subsidiaries/Associate (181,518) (4,386,123) Net cash used in investing activities (151,753,682) (184,326,923)

6 Consolidated - Airtel 149-192.p65 152 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 per Prashant Singhal Sunil Bharti Mittal Manoj Kohli Manoj Cha SunilBhartiMittal New : Place Membership No:93283 Partner Singhal Prashant per Chartered Accountants For S.R.BATLIBOI&ASSOCIATES As perourreportofevendate ae: Date 4Duringtheyear,CompanyincreaseditsstakeinBhartiHexacomLimitedby1.11%throughacquisitionof27,80,306 equity 4 CashandcashequivalentsincludesRs.96,101thousandspledgedwithvariousauthorities(March31,2008142,573 3 Previousyearfigureshavebeenregrouped and recastwherevernecessarytoconformthecurrentyearclassification. 2 Figuresinbracketsindicatecashoutflow. 1 Notes : Cashflowfromfinancingactivities: C. Particulars ah&Bn aacsa e ceue927,659,715 Cash &BankBalancesasperschedule9 ahadCs qiaet sa ered13,044,515 20,648,497 Cash andEquivalentscomprise: Cash andEquivalentsasatyearend Opening CashandEquivalents Net Increase/(Decrease)inCashandEquivalents Net cashfromfinancingactivities ah&Cs qiaet nCs lwSaeet13,044,515 Year acquisitionofequityinNetworki2iLimitedatapurchaseconsiderationRs.5,313,916thousand.) shares foranaggregateconsiderationofRs.166,818thousandtherebyincreasingitsinvestmentbysameamount.(Previous thousands) whicharenotavailableforusebytheCompany. Cash &EquivalentsinFlowStatement Proceeds fromshorttermborrowings Proceeds fromlongtermborrowings Less: -Fixeddepositsnotconsidered Balance withScheduled Cash andChequesin Cash AcquiredonAcquisitionofSubsidiary neetPi (4,669, Gain/(loss) fromswaparrangements Interest Paid eeps2,6,9 48,017,356 (19,631,776) (15,288,260) 27,462,693 193,531 176,058 Net movementincashcreditfacilities Payments Receipts Issue ofSharesunderESOPScheme(includingshareapplication) Proceeds fromfreshissueofShareCapital April 29, 2009 Group General Counsel & Company Secretary Chief Financial Officer Financial Chief GroupGeneralCounsel &CompanySecretary April 29,2009 Delhi 153 ad639, hand Banks as cashequivalents and shortterm (including ShareP ra n aaigDrco CEO&JointManagingDirector irman andManagingDirector iaaSmahSrikanthBalachander Sampath Vijaya on 12,796,423 loans ForandonbehalfoftheBoardDirectorsBhartiAirtelLimited eim 4,0 20,170,500 149,400 remium) o h ereddFortheyearended For theyearended ac 1 09March31,2008 March 31,2009 7/21/2009, 9:23 PM 46520– 14,615,200 709775,717,242 27,019,767 ,3,6 8,020,899 (1,095,663) 7,034,067 6,010,448 R.‘0)(Rs.‘000) (Rs. ‘000) 216(67,647) 22,156 7)(3,879,932) 973) 4 1,316,825 948 – 59,987,215 15,185,183 7,034,067 7,034,067 7,034,067 108,831 153

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of consolidated accounts

Particulars As at As at March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 1 SHARE CAPITAL Authorised 2,500,000,000 (March 31, 2008 - 2,500,000,000) 25,000,000 25,000,000 Equity shares of Rs. 10 each

Issued, Subscribed and Paid up 1,898,239,796 Equity Shares of Rs. 10 each fully paid up 18,982,398 18,979,074 (March 31, 2008 - 1,897,907,446 Equity Shares of Rs. 10 each) (Refer Notes Below) 18,982,398 18,979,074

Notes: (a) 49,999,000 and 1,516,390,970 equity shares issued as fully paid-up bonus shares on February 24, 1997 and September 30, 2001 respectively out of Share Premium account (b) 21,409,142 Equity Shares (March 31, 2008 - 21,315,734) shares are allotted as fully paid up upon the conversion of Foreign Currency Convertible Bonds (FCCBs). (Refer Note 22 on Schedule 22) (c) 2,722,125 Equity Shares (March 31, 2008 - 2,722,125) shares are allotted as fully paid up under the Scheme of amalgamation without payments being received in cash. (d) For Stock options outstanding details (refer note no 22 on Schedule 21 and Note 19 on Schedule 22)

SCHEDULE : 2 RESERVES AND SURPLUS Securities Premium Opening balance 39,889,844 39,259,225 Additions during the year 256,997 630,619 40,146,841 39,889,844 Revaluation Reserve 21,284 21,284 Debentures Redemption Reserve Opening balance 139,958 553,581 Transferred to Profit and Loss Account during the period (4,411) (413,623) 135,547 139,958 General Reserve 6,000,000 Reserve for Business Restructuring Opening balance 24,396,990 – Additions during the period – 82,181,203 Less : Transferred to Profit and Loss Account during the period * – 57,396,005 Less : Depreciation on Fair Valued Assets transferred to Profit & Loss Account during the period in accordance with the Scheme of Arrangement * 2,324,209 388,208 22,072,781 24,396,990 * (Refer Note 2(b) of Schedule 22)

6 Consolidated - Airtel 149-192.p65 154 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 Loans andAdvancesfromBanks: Debentures (Refer Note13onSchedule22) SECURED LOANS SCHEDULE :3 Reserve arisingondilutionofEquity Reserve arisingondilutionofEquityinSubsidiaryCompany Foreign CurrencyTranslationReserve Balance asperProfit& SCHEDULE :2(Cont.) Particulars Other LoansandAdvances: oe mutrpybewti n er3,9,8 19,007,222 37,494,785 30,255,750 32,035,500 69,864 Note: Amountrepayablewithinoneyear 134,976 Other LoansandAdvances Short TermLoansandAdvances of Rs.10,000each Interest Free,non-cumulative,ConvertibleDebentures UNSECURED LOANS SCHEDULE :4 Note :Amountrepayablewithinoneyear Schedules of consolidatedaccounts es:Uiiain/Ajsmn 1335 – (133,325) -Cash Credit -Term Loans Less :Utilisation/Adjustment Additions Opening -Vehicle Loans rmOhr 3435627,535,730 32,840,340 33,473,546 4,803,050 39,968,535 15,406,584 From Others From Banks From Banks 155 Loss Account annexedtoandformingpart in SubsidiaryCompany 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 2,8,6 95,434,870 120,884,165 8,1,8 120,157,916 188,310,180 7,8,1 197,688,417 270,888,116 37000– 13,770,000 42734582,598 14,287,304 3966013,090,339 13,976,610 30039– 13,090,339 ,1,9 13,090,339 1,019,596 R.‘0)(Rs.‘000) (Rs. ‘000) 0,0 500,000 500,000 2,7 (7,914) 224,873 73424,244 17,304 sa Asat As at 58,354 – 155

BHARTI AIRTEL ANNUAL REPORT 2008-09 6 Consolidated -Airtel149-192.p65

SCHEDULE 5 : FIXED ASSETS (Refer Note 3, 4, 5,10,16 and 17 on Schedule 21 and Note 2(b), 8, 14 and 17 on Schedule 22) (Rs. ‘000)

Gross Block Value Depreciation Net Block PARTICULARS As at Additions Sale / As at As at For the Sale / As at As at As at April 01, during Adjustment March 31, April 01, year Adjustment March 31, March 31, March 31, 2008 the year during 2009 2008 during 2009 2009 2008 the year the year 156 INTANGIBLE ASSETS Goodwill 8,613,858 11,516 - 8,625,374 1,336,430 800,355 - 2,136,785 6,488,589 7,277,428 Software 83,993 44,460 - 128,453 83,993 6,891 - 90,884 37,569 - Bandwidth 7,408,947 1,160,799 5,310,284 3,259,462 976,582 171,378 890,129 257,831 3,001,631 6,432,365 Licence 22,669,463 - (60,964) 22,730,427 9,981,401 1,217,408 (133) 11,198,942 11,531,485 12,688,062 TANGIBLE ASSETS Leasehold Land 65,258 232,658 (22,855) 320,771 4,307 3,408 657 7,058 313,713 60,951 Freehold Land 621,165 132,028 32,737 720,456 ----720,456 621,165 Building 2,892,586 701,965 (35,434) 3,629,985 611,844 146,669 (1,360) 759,873 2,870,112 2,280,742 Leasehold Improvements 2,475,765 652,093 87,086 3,040,772 898,423 373,337 34,661 1,237,099 1,803,673 1,577,342 Plant and Machinery 358,792,295 158,284,640 (2,069,935) 519,146,870 70,392,952 44,231,160 481,778 114,142,334 405,004,536 288,399,343 Computers 16,851,836 4,924,477 227,143 21,549,170 11,822,249 3,625,446 187,898 15,259,797 6,289,373 5,029,587 Office Equipment 1,622,222 629,663 63,789 2,188,096 967,730 315,916 56,894 1,226,752 961,344 654,492 Furniture & Fixture 936,752 135,655 11,134 1,061,273 571,508 139,577 6,203 704,882 356,391 365,244 Vehicles 185,709 46,270 21,297 210,682 81,882 37,968 12,955 106,895 103,787 103,827 Vehicles on Finance Lease 4,259 - - 4,259 354 151 - 505 3,754 3,905 TOTAL 423,224,108 166,956,224 3,564,282 586,616,050 97,729,655 51,069,664 1,669,682 147,129,637 439,486,413 325,494,453 Capital Work In Progress 41,436,526 35,699,610 GRAND TOTAL 423,224,108 166,956,224 3,564,282 586,616,050 97,729,655 51,069,664 1,669,682 147,129,637 480,922,939 361,194,063 Previous Year 281,199,178 223,922,684 81,897,754 423,224,108 76,155,422 36,572,157 14,997,924 97,729,655

7/21/2009, 9:23 PM Notes: 1. Addition to fixed assets during the year includes : Rs. Nil (March 31, 2008 loss of Rs. 1,689,459 thousand) on account of fluctuations in foreign exchange rates 2. Capital work in Progress during the year is net of Rs. Nil (March 31, 2008 includes Rs. 3,327 thousand gain) on account of fluctuation in Exchange rate 3. Freehold Land and Building includes Rs. 14,013 thousand (Previous year Rs. 26,468 thousand) and Rs. 297,301 thousand (previous year Rs. 71,477 thousand) respectively, in respect of which registration of title in favour of the Company is pending 4. Building includes building on leasehold land Rs. 59,439 thousand (March 31, 2008 Rs. 17,288 thousand) 5. The remaining amortisation period of licence fees as at March 31, 2009 ranges between 6 to 16 years for Unified Access Service Licence and 13 years for Long Distance Licences 6. Capital work in progress includes goods in transit Rs. 2,717,484 thousand (March 31, 2008 Rs. 3,095,810 thousand) and Capital Advance of Rs. 3,591,436 thousand (March 31, 2008 Rs. 3,373,250 thousand) 7. Computers include Gross Block of assets capitalised under finance lease Rs. 12,338,941 thousand (March 31, 2008 Rs. 8,095,086 thousand) and corresponding Accumulated Depreciation being Rs. 7,258,050 thousand (March 31, 2008 Rs. 4,627,150 thousand) 8. The remaining amortisation period of Goodwill as at March 31, 2009 ranges between 5 to 16 years. 9. Sales and Adjsutment during the year includes reclassification of class of Assets. 6 Consolidated -Airtel149-192.p65 Total Investments Others Investment inAssociates Long Term,trade,unquoted Long term,otherthantrade,Unquoted Current, otherthantrade,Unqoted Current, otherthantrade,Quoted (Refer Note8onSchedule21) INVESTMENTS SCHEDULE :6 Particulars thousand (March31,2008Rs.88,290thousand) * NetofobsoleteinventorywrittenoffRs.60,604 (March 31,2008Rs.23,408thousand) * IncludesGoodsinTransitRs.Nilthousand Stock-In-Trade* (Refer Note7onSchedule21) INVENTORY SCHEDULE :7 Schedules of consolidatedaccounts Aggregate ValueofUnquotedInvestments Aggregate ValueofQuotedInvestments Aggregate MarketValueofQuotedInvestments Peiu er1000 qiySae 01550,125 3,126 50,125 27,069 1,835 – 1,757,384 14,700 (Previous Year100,000)EquityShares IFFCO KissanSancharLimited:100,000 Nil) ofRs.10eachfullypaidup)(ReferNote2(k)onSchedule22) Bharti TeleportLimited:1,470,000Equityshares(Previousyear - Governmentsecurities - DepositsandBonds - MutualFunds,Debentures 157 n od 1654048,016,755 21,665,480 and Bonds annexedtoandformingpart 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 3495448,097,075 23,489,524 1654048,043,824 48,097,361 21,665,480 21,749,914 ,2,4 80,320 1,824,044 R.‘0)(Rs.‘000) (Rs. ‘000) 6,7 1,142,295 1,142,295 962,676 962,676 sa Asat As at 157

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of consolidated accounts

Particulars As at As at March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 8 SUNDRY DEBTORS (Refer Note 6 on Schedule 21) (Unsecured, considered good unless otherwise stated) Debts outstanding -Considered good 28,997,771 28,398,245 -Considered doubtful 9,945,948 7,114,566 Less : Provision for doubtful debts (9,945,948) 28,997,771 (7,114,566) 28,398,245

28,997,771 28,398,245

SCHEDULE : 9 CASH AND BANK BALANCES Cash in Hand 100,805 143,812 Cheques in Hand 539,143 1,173,013 Balances with Scheduled Banks - in Current Account 2,936,766 1,150,722 - in Fixed deposits * 24,079,032 4,561,964 - in Deposit Account as Margin Money 3,969 4,556

27,659,715 7,034,067

*[Includes Rs. 92,132 thousand pledged with various authorities (March 31, 2008 Rs. 138,017 thousand)]

SCHEDULE : 10 OTHER CURRENT ASSETS Interest Accrued on Fixed Deposit and on Loan given to Joint Venture 520,742 24,808 Unamortised upfront fees and Deferred Premium 1,018,596 980,059 Others 12,897 14

1,552,235 1,004,881

6 Consolidated - Airtel 149-192.p65 158 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 atclr sa As at As at (Unsecured, consideredgoodunlessotherwisestated) LOANS ANDADVANCES SCHEDULE :11 Particulars Provisions Current Liabilities CURRENT LIABILITIESANDPROVISIONS SCHEDULE :12 Schedules of consolidatedaccounts s 1 huad]64154 765,146 46,488 3,083,129 694 55,310 MAT Credit Rs. 716thousand)] tax Rs.839thousand(March31,2008 Advance WealthTax[NetofProvisionfor Rs. 544,805thousand)] Rs. 961,486thousand(March31,2008 Fringe BenefitTax(Netofprovisionfortax dac oEO rs 0,8 116,971 105,489 (March 31,2008Rs. Rs. 28,241,857thousand Advance Tax[Netofprovisionfortax Advance toESOPTrust value tobereceived Advances recoverableincashorkindfor a nDvdn 4,1 - 7,528 645,212 428,987 3,058 525,781 3,931,091 698,879 822,908 617,981 5,764,529 732,681 Tax onDividend Proposed Dividend(ReferNote 24 Others (ReferNote14(i)and 6 728,759 28,930,984 and 14(ii)onSchedule22) Warranty (ReferNote20onschedule21 Schedule 21andNote6on22) Leave Encashment(ReferNote11on 1,093,227 and Note6onSchedule22) Gratuity (ReferNote11onSchedule21 34,641,872 to Companiesunderthesamemanagement *Refer Note16onSchedule22forLoans&Advances Security Deposits(ReferNote10 Advance Receivedfromcustomers Other Liabilities Interest accruedbutnotdueonloans Advance BillingandPrepaidCardRevenue Sundry Creditors: oa usadn uso ir n ml nepie 672– Micro andSmallEnterprises* Total outstandingduesofcreditorsotherthan 56,792 Total outstandingduesofMicroandSmallEnterprises osdrddutu ,3,4 4,265,898 26,332,008 (4,265,898) 55,043,875 (4,436,842) 4,436,842 Less :Provision Considered doubtful Considered good 159 17,913,535 thousand)] i nShdl 2 121795,940,974 11,281,789 (i) onSchedule22) annexedtoandformingpart nShdl 2 ,2,1 3,666,023 7,524,112 on Schedule22) nShdl 2 ,9,8 - 3,796,480 on Schedule22) 1,1,9 1,6,8 0,3,6 103,239,665 103,239,665 118,869,282 118,812,490 5038526,332,008 55,043,875 ac 1 09March31,2008 March 31,2009 8,6,8 148,226,622 185,665,180 141,323,352 168,621,781 0547227,486,641 60,534,722 703396,903,270 17,043,399 ,4,2 225,874 2,246,225 R.‘0)(Rs.‘000) (Rs. ‘000) 7/21/2009, 9:23 PM 159

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of consolidated accounts

Particulars As at As at March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000)

SCHEDULE : 13 MISCELLANEOUS EXPENDITURE (To the extent not written off or adjusted) (Refer Note 15 on Schedule 21 and Note 19 on Schedule 22) Deferred Employee Compensation Expense * Opening Balance – – Add: Adjustments during the year (1,351) (6,594) Less: Amortisation for the year ** (1,351) (6,594) ––

* Relating to Employee Stock Option Scheme 2001 and 2004 ** Net of stock compensation income of Rs. 3,682 thousand (March 31, 2008 Rs. 3,886 thousand)

Premium on Redemption of Debentures Opening Balance 2,034 26,629 Less: Write back during the year 588 20,217 Less: Amortisation for the year 573 4,378 873 2,034 873 2,034

6 Consolidated - Airtel 149-192.p65 160 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 NETWORK OPERATINGEXPENDITURE SCHEDULE :14 Particulars COST OFGOODSSOLD SCHEDULE :15 tes840225,624,634 837,311 8,400,292 6,874,508 6,013,656 1,811,107 721,788 419,356 7,243,797 7,156,469 746,386 488,020 569,999 Others Simcard Utilisation Sales CommissionandIncentive 642,923 Advertisement andMarketing SALES ANDMARKETINGEXPENDITURE SCHEDULE :17 (Refer Note19(vii)onSchedule22) *Excluding amortisationofDeferredESOPCost Recruitment andTraining Staff Welfare Contribution toProvidentandOtherFunds Salaries, Wagesand (Refer Note11onSchedule21and622) PERSONNEL EXPENDITURE SCHEDULE :16 Schedules of consolidatedaccounts tes655933,299,278 125,878 5,076,453 6,525,903 126,544 10,588,493 756,273 212,700 11,428,559 75,246 21,960,934 1,218,395 928,155 871,268 Others Internet accessandbandwidth Leased LineandGatewaycharges - Plant Repairs andMaintenance Insurance Rent Power andFuel Installation Interconnect chargesandPSTNRentals es:CoigSok*92661,142,295 912,142 837,311 1,284,407 962,676 1,142,295 1,811,107 1,265,279 *Net ofobsoleteinventorywrittenoffRs.60,604 :ClosingStock* Less :Internalissues/capitalised Less :SimcardUtilisation Less :Purchases Add Opening Stock thousand (March31,2008Rs.88,290thousand) 161 ou*1,4,1 12,680,411 15,145,612 Bonus* tes293051,284,515 2,913,055 - Others hre ,2,1 2,392,454 2,524,918 charges annexedtoandformingpart n ahnr 456827,851,500 14,596,872 and Machinery ac 1 09March31,2008 March 31,2009 2378032,429,543 62,327,850 4616519,350,109 24,611,665 14,391,554 17,022,941 ereddyearended year ended ,9,0 3,540,880 3,895,304 R.‘0)(Rs.‘000) (Rs. ‘000) 7/21/2009, 9:23 PM 9,3 1,189,009 998,537 o h Forthe For the 161

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of consolidated accounts

Particulars For the For the year ended year ended March 31, 2009 March 31, 2008 (Rs. ‘000) (Rs. ‘000) SCHEDULE : 18 ADMINISTRATIVE AND OTHER EXPENDITURE Legal and Professional 6,585,414 3,802,613 Rates and Taxes 177,222 50,281 Power and Fuel 627,045 613,807 IT and Call center Outsoursing 6,837,202 5,272,887 Traveling and Conveyance 1,326,528 1,196,845 Rent 1,241,532 1,250,242 Repairs and Maintenance - Building 210,723 101,619 - Others 448,311 678,391 Insurance 32,665 12,852 Bad debts written off 815,967 2,022,676 Provision for doubtful debts/advances 3,002,326 1,216,992 Provision for Diminution in Stock/CWIP 519,726 43,113 Collection and Recovery 1,882,834 1,410,002 Loss on sale of assets (net) 25,735 64,827 Miscellaneous 789,740 2,996,200 24,522,970 20,733,347

SCHEDULE : 19 OTHER INCOME Liabilities/ Provisions no longer required written back 577,057 387,408 Miscellaneous 946,757 2,408,672 1,523,814 2,796,080

SCHEDULE : 20 FINANCE EXPENSE (NET) Interest : - On Term Loan 2,693,821 1,948,841 - On Debentures 58,457 68,341 - On Others 44,961 63,087 Amortisation of Premium on Redemption of FCCBs 573 4,378 Other Finance Charges 2,233,280 1,779,428 Exchange fluctuation loss (Net) 17,967,263 2,121,266 Loss from swap arrangements (Net) 65,433 97,562 23,063,788 6,082,903 Less : Income Profit on sale of Current Investments (other than trade) 2,592,369 582,609 Interest Income - from Current Investments and Fixed Deposits (Other than Trade) [Gross of TDS Rs. 135,553 thousand (March 31, 2008 Rs. 40,030 thousand)] 887,618 198,844 - from other advances 8,742 17,545 - Other Finance Income 962,231 5,215 [Gross of TDS Rs. 120,558 thousand (March 31, 2008 Rs. Nil)] 4,450,960 804,213 18,612,828 5,278,690

6 Consolidated - Airtel 149-192.p65 162 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 .PRINCIPLES OFCONSOLIDATION 2. BASISOFPREPARATION 1. set outbelow. and jointventures(hereinafterreferredtoasthe“Group”)inrespectoftheseConsolidatedFinancialStatements,are The significantaccountingpoliciesadoptedbyBhartiAirtelLimited(‘BhartiAirtel’ortheCompany)anditssubsidiaries SCHEDULE: 21 THE YEARENDEDMARCH31,2009 STATEMENT OFSIGNIFICANTACCOUNTINGPOLICIESTOTHECONSOLIDATEDFINANCIALSTATEMENTSFOR Schedules of consolidatedaccounts hriIfae iie ni Passive products India Bharti InfratelLimited wholesaleswitchingdata Limited (Singapore) Pte Bharti AirtelHoldings Network i2iLimited SriLanka (Pvt) Limited Singapore Bharti AirtelLanka Limited Private (Singapore) Bharti Airtel iie prt n u icat ofBhartiAirtel operateandrunAircrafts/ Direct- 14.28% to Venture Joint Buy,sell, lease,hire,maintain, andfixedTelephone Services India Bharti Telemedia Cellular Mobile India AirtelandVSATequipment Limited Forum IAviation Limited India andwholesaleswitching Bridge MobilePte (‘BHL’) Manpower Limited International Bharti Hexacom Comtel Limited) (erstwhile Bharti Canada (‘BASL’) Limited India Bharti AirtelServices Limited (Canada) Bharti Airtel Count Entity and Investmentinassociatesasfollows: These accountsrepresentconsolidatedoftheGroupanditsmajorityownedsubsidiaries,jointventures discussed inNote10below,areconsistentwiththoseusedthepreviousyear. policies havebeenconsistentlyappliedbytheCompanyand,exceptforchangesinaccountingpolicy 2006, (‘asamended’)andconsolidatedasperPara2belowfortheyearendedMarch31,2009.Theaccounting 27, FinancialReportingofInterestsinJointVenturesnotifiedunderCompanies(AccountingStandards)Rules, Statements’ ,AS-23‘AccountingforInvestmentsinAssociatesConsolidatedFinancialandAS- basis ofaccountingandreportingrequirementsAccountingStandard(‘AS’)21‘ConsolidatedFinancial Group. Theseconsolidatedfinancialstatementsarepreparedunderthehistoricalcostconventiononaccrual provisions oftheCompaniesAct,1956toreflectfinancialpositionandresultsoperations accounting standardsbyCompanies(AccountingStandards)Rules,2006,(‘asamended’)andtherelevant These consolidatedfinancialstatementshavebeenpreparedtocomplyinallmaterialrespectswithnotified UA iie fAeiaandwholesaleswitching International of America States United Limited (USA) Bharti Airtel [Refer Note(b)] Limited (‘BTML’) 163 igpr netet usday100% Subsidiary Investments Singapore Mauritius igpr Mobile Singapore at Incorporation ry of Principal Service Principal ry of annexedtoandformingpart Submarine CableSystem Mobile Services International callingservices eiotr t.ServicesLimited Helicopters etc. trading. data products Mobile Services data products evcsJitVnue10.00% JointVenture Services Infrastructure for - HomeServices support toBharti calling services calling services and Broadband n usday100% Subsidiary and 7/21/2009, 9:23 PM usday100% Subsidiary usday100% Subsidiary usday100% Subsidiary 100% Subsidiary Relationship usday70% Subsidiary 92.51% Subsidiary usday100% Subsidiary 40% Subsidiary Shareholding as March 31,2009 163

BHARTI AIRTEL ANNUAL REPORT 2008-09 Entity Country of Principal Service Relationship Shareholding as Incorporation at March 31, 2009 Bharti Airtel (UK) United Kingdom International calling services Subsidiary 100% Limited and wholesale switching data products Bharti Airtel Hong Kong International calling services Subsidiary 100% (Hong Kong) Limited and wholesale switching data products Indus Towers Limited India Passive Infrastructure Services Joint Venture 42%* of Bharti Infratel Limited Bharti Infratel Lanka Sri Lanka Passive Infrastructure Services Subsidiary of 100% Private Limited a Subsidiary Bharti Infratel India Passive Infrastructure Services Subsidiary of 100%* Ventures Limited Bharti Infratel Limited Bharti Aquanet India Submarine Cable landing station Subsidiary 100%** Limited Bharti Teleports India Uplinking Channels for Associate 49% Limited Broadcaster

*Represents holding of Bharti Infratel Limited **Up to December 31, 2008, Refer note 2(a) on Schedule 22 a) For the purpose of this consolidation, jointly owned entities, where Bharti Airtel or its subsidiaries own directly or indirectly more than 50 percent of voting rights of a Company’s share capital, have been accounted for as subsidiaries. b) The Company controls the majority of the Board of Directors of BTML, accordingly BTML has been consolidated with the Company in accordance with AS 21, ‘Consolidated Financial Statements’ notified under Companies (Accounting Standards) Rules, 2006, (‘as amended’). c) The equity and net income attributable to minority shareholders’ interest are shown separately in the Balance Sheet and Profit and Loss Account, respectively. Reserves arising on dilution of equity in a subsidiary company is shown separately as ‘Reserve arising on dilution of Equity in Subsidiary Company’ under the head ‘Reserves and Surplus’. d) The Group’s interests in jointly controlled entities are accounted for by proportionate consolidation. The Group combines its share of the joint ventures’ individual income and expenses, assets and liabilities and cash flows on a line-by-line basis with similar items in the Group’s financial statements. e) Inter-Company balances have been eliminated in the consolidation. The consolidated financial statements are prepared using uniform accounting policies for like transactions and other events in similar circumstances. 3. GOODWILL Goodwill is stated as an excess of the purchase consideration over Bharti Airtel’s interest in the net identifiable assets acquired. Goodwill is carried at cost less accumulated amortisation and is amortised on a straight-line basis over the remaining period of the service licence of the acquired Company. In case the acquired company does not have a Licence, Goodwill is amortised over 10 year period from the date of acquisition. 4. FIXED ASSETS Fixed Assets are stated at cost of acquisition and subsequent improvements thereto, including taxes & duties (net of cenvat credit), freight and other incidental expenses related to acquisition and installation. Capital work- in-progress is stated at cost. Site restoration cost obligations are capitalized when it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the amount can be made. The intangible component of license fee payable by the Group for cellular and basic circles, upon migration to the National Telecom Policy (NTP 1999), i.e. Entry Fee, has been capitalised as an asset and the one time license fee paid by the Group for acquiring new licences (post NTP-99) (basic, cellular, national long distance and international long distance services) has been capitalised as an intangible asset. 5. DEPRECIATION/AMORTISATION Depreciation is provided on straight-line method, at the rates determined based on the estimated economic useful lives of assets as follows:

6 Consolidated - Airtel 149-192.p65 164 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 .REVENUERECOGNITIONANDRECEIVABLES 6. churn period. amortized overtherelatedestimated customersrelationshipperiod,asderivedfrom theestimatedcustomer Activation revenueandrelated directactivationcosts,notexceedingthe revenue,aredeferredand Activation Income rewards tothecustomersand whennosignificantuncertaintyexistsregardingrealisation oftheconsideration. Service revenueisrecognised oncompletionofprovisionservicesandtransfer ofallsignificantrisksand Others straight linebasisoverthefixed,noncancellabletermof theagreement,asapplicable. payment termsintheserviceagreementsincludefixedescalations, theeffectofsuchincreasesisrecognisedon and maintenancecharges.Revenueforuseofsitesisrecognised asandwhentheservicesarerendered.If Service incomeincludesrevenuefromuseofsites/assets andreimbursementofenergycharges,rent,security Passive InfrastructureServices Internet andSatelliteservices. from thedateofsatisfactoryinstallationequipment and softwareatthecustomersiteprovisioningof recognised asrevenueonsatisfactorycompletionofinstallation ofhardwareandservicerevenueisrecognised Registration feesisrecognisedatthetimeofdispatch and invoicingofStartupKits.Installationchargesare Service Revenuesincludesrevenuesfromregistration,installationandprovisionofInternetSatelliteservices. customer andwhennosignificantuncertaintyexistsregardingrealisationofconsideration. Revenue, netofdiscount,fromsalegoodsisrecognisedontransferallsignificantrisksandrewardstothe Enterprise ServicesCorporate Revenue fromprepaidcallingcardspacksisrecognisedontheactualusagebasis. significant uncertaintyexistsregardingrealisationofconsideration. from saleofgoodsisrecognisedontransferallsignificantrisksandrewardstothecustomerwhenno access chargespassedontootheroperators,andisnetofdiscountswaivers.Revenue,discount, is recognisedontimeproportionbasisinaccordancewiththerelatedcontracts.ServiceRevenueincludes Service revenueisrecognisedoncompletionofprovisionservices.Revenueaccountbandwidthservice Telemedia Services(ErstwhileBroadband&TelephoneServices)andEnterpriseCarriers validity period,asapplicable. Processing feesonrechargeisbeingrecognisedovertheestimatedcustomerrelationshipperiodorvoucher customer andwhennosignificantuncertaintyexistsregardingrealisationofconsideration. Revenue, netofdiscount,fromsalegoodsisrecognisedontransferallsignificantrisksandrewardstothe roaming commissionandaccesschargespassedontootheroperators,isnetofdiscountswaivers. Service revenueisrecognisedoncompletionofprovisionservices.includesincome 5 Mobile Services Fixed AssetscostinguptoRs.5thousandarebeingfullydepreciatedwithinoneyearfromthedateofacquisition. asset, orbalanceleaseperiodasapplicable. 5years/2years The siterestorationcostobligationcapitalizedisdepreciatedovertheperiodofusefulliferelated 5 years 20 years operations. OverEstimatedSubscriberLife 3to20years 3 years is beingamortisedequallyoverthebalanceperiodoflicencefromdatecommencementcommercial The EntryFeecapitalisedisbeingamortisedequallyovertheperiodoflicenseandonetimelicencefee Periodoflease of 18years. Period ofleaseor10years,whicheverislower Bandwidth capacityisamortisedonstraightlinebasisovertheperiodofagreementsubjecttoamaximum 20yearsorperiodoflease,whicheverislower Software uptoRs.500thousandiswrittenoffinthefinancialyearplacedservice. Equipment Premises Customer Vehicles Furniture andFixtures Equipment Office Computer /Software Machinery & Plant Improvements Leasehold Land Leased on Building Building Land Leasehold 165 Useful lives years 7/21/2009, 9:23 PM 165

BHARTI AIRTEL ANNUAL REPORT 2008-09 Investing and other Activities Income on account of interest and other activities are recognised on an accrual basis. Dividends are accounted for when the right to receive the payment is established. Provision for doubtful debts The Group provides for amounts outstanding for more than 90 days in case of active subscribers and for entire outstanding from deactivated customers, net off security deposits, or in specific cases where management is of the view that the amounts from certain customers are not recoverable. For receivables due from the other operators on account of their NLD and ILD traffic and IUC charges, the Group provides for amounts outstanding for more than 120 days from the date of billing, net of any amounts payable to the operators, or in specific cases where management is of the view that the amounts from the operators are not recoverable. Accrued Billing revenue Accrued billing revenue represent revenues recognized in respect of Mobile, Broadband and Telephone, and Long Distance services provided from the bill cycle date to the end of each month. These are billed in subsequent periods as per the terms of the billing plans. 7. INVENTORY Inventory is valued at the lower of cost and net realisable value. Cost is determined on First in First out basis. Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and the estimated costs necessary to make the sale. The Company provides for obsolete and slow-moving inventory based on management estimates of the usability of inventory. 8. INVESTMENTS Current Investments are valued at lower of cost and fair market value determined on individual basis. Long term Investments are valued at cost. Provision is made for diminution in value to recognise a decline, if any, other than that of temporary nature. 9. LICENSE FEES – REVENUE SHARE With effect from August 1, 1999, the variable Licence fee computed at prescribed rates of revenue share is charged to the Profit and Loss Account in the period in which the related revenues are recognised. Revenue for this purpose is defined as adjusted gross revenue as per the respective license agreements. 10. FOREIGN CURRENCY TRANSLATION, ACCOUNTING FOR FORWARD CONTRACTS & DERIVATIVES Initial Recognition Foreign currency transactions are recorded in the reporting currency, by applying to the foreign currency amount the exchange rate between the reporting currency and the foreign currency at the date of the transaction. Conversion Foreign currency monetary items are reported using the closing rate. Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange rate at the date of the transaction; and non-monetary items which are carried at fair value or other similar valuation denominated in a foreign currency are reported using the exchange rates that existed when the values were determined. Exchange Differences Exchange differences arising on the settlement of monetary items or on restatement of the Company’s monetary items at rates different from those at which they were initially recorded during the period/year, or reported in previous financial statements, are recognized as income or as expenses in the period/year in which they arise as mentioned below. During the year, the Company has, with effect from the April 1, 2008, changed its policy to charge/credit fluctuations in respect of loans/liabilities for acquisition of fixed assets directly to the Profit & Loss Account from adjusting such exchange differences in the carrying cost of the respective assets. Forward Exchange Contracts covered under AS 11, ‘The Effects of Changes in Foreign Exchange Rates’ Exchange differences on forward exchange contracts & plain vanilla currency options for establishing the amount of reporting currency and not intended for trading & speculation purposes, are recognised in the Profit & Loss Account in the year in which the exchange rate changes. The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation or renewal of such forward exchange contract is recognised as income or expense for the period/year.

6 Consolidated - Airtel 149-192.p65 166 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 1 EMPLOYEEBENEFITS 11. e TheGroupprovidesforgratuityobligationsthrough adefinedbenefitretirementplan(the‘GratuityPlan’) (e) Shorttermcompensated absencesareprovidedforbasedonestimates.Longterm compensatedabsences (d) SomeemployeesoftheGroupareentitledtosuperannuation, adefinedcontributionplanwhichisadministered (c) AllemployeesoftheGroupareentitledto receivebenefitsundertheProvidentFund,whichisadefined (b) Shorttermemployeebenefitsarerecognisedintheperiodduringwhich the serviceshavebeenrendered. (a) and anylossonsuchvaluationisrecognisedintheProfitLossAccountforyear. Foreign exchangecontractsintendedfortradingand/orspeculationarefairvaluedonamarked-to-marketbasis Foreign exchangecontractsfortradingandspeculationpurpose differences areaccumulatedinaforeigncurrencytranslationreserveuntilthedisposalofnetinvestment. expense itemsaretranslatedatexchangeratethedateoftransactionforyear;andallresulting the assetsandliabilities,bothmonetarynon-monetaryaretranslatedatclosingrate;income In translatingthefinancialstatementsofanon-integralforeignoperationforincorporationinstatements, operation havebeenthoseoftheGroupitself. The financialstatementsofanintegralforeignoperationaretranslatedasifthetransactions Translation ofIntegralandNon-IntegralForeignOperation valuations andreversalsofsuchreductionsareincludedinprofitlossstatementtheperiod/year. instrument isrecognizedintheProfitandLossAccountforperiod/year.Anyreductionmarktomarket trading ornon-hedgingderivativeinstrument.Thelossonmarked-to-marketvaluationoftheembedded a derivativeinstrument,theembeddedisseparatedfromhostcontract,carriedatfairvalueas and risksofthehostcontract(2)aseparate,stand-aloneinstrumentwithsametermswouldqualifyas possesses economiccharacteristicsandrisksthatarenotclearlycloselyrelatedtothe would meetthedefinitionofaderivativeinstrument.Whenitisdeterminedthat(1)embedded contract andwhetheraseparate,non-embeddedinstrumentwiththesametermsasembedded are clearlyandcloselyrelatedtotheeconomiccharacteristicsrisksofremainingcomponenthost instrument. TheCompanyassesseswhethertheeconomiccharacteristicsandrisksofembeddedderivative all ofthecashfloworvalueotherexchangesrequiredbycontractinamannersimilartoderivative instrument thatmaycontain“embedded”derivativeinstruments–implicitorexplicittermsaffectsome The Companyoccasionallyentersintocontractsthatdonotintheirentiretymeetthedefinitionofaderivative Embedded DerivativeInstruments period/year. reduction tofairvaluesandanyreversalsofsuchreductionsareincludedinProfitLossstatementthe keeping inviewtheprincipleofprudenceasenunciatedAS1,‘DisclosureAccountingPolicies’.Any contract basis.Anygainonmarked-to-marketvaluationrespectivecontractsisnotrecognizedbytheCompany, on amarked-to-marketbasisandanylossvaluationisrecognisedintheProfitLossAccount,each capital goodsusingforeigncurrencyloan.Ateveryyearendalloutstandingderivativecontractsarefairvalued hedge itsriskswithrespecttoforeigncurrencyfluctuationsandinterestrateexposurearisingoutofimport establish theamountofreportingcurrencyrequiredoravailableatsettlementdateatransaction;to in thenatureofforwardcontractsdesignatedunderAS11assuchandthatarenotenteredto The Companyentersintovariousforeigncurrencyoptioncontracts&interestrateswapthatarenot Other DerivativeInstruments,notinthenatureofAS11,‘TheEffectsChangesForeignExchangeRates’ Account fortheperiod/year. contract foranearlierperiod)arerecognisedintheProfitandLoss maturity periodandthecontractedforwardrate(orlastusedtomeasureagainorlosson currency arisingduetothedifferencebetweenforwardrateavailableatreportingdateforremaining Exchange differenceonforwardcontractswhicharetakentoestablishtheamountotherthanreporting covering allemployees. TheGratuityPlan provides alumpsumpayment tovestedemployeesatretirement method. are providedforbasedonactuarial valuation.Theactuarialvaluationisdoneasper projectedunitcredit incurred. through LifeInsuranceCorporationofIndia(“LIC”).Superannuation benefitsarerecordedasanexpense has nofurtherobligationsundertheseplansbeyondits monthly contributions. The Group’scontributionstoboththeseschemesareexpensed intheProfitandLossAccount.TheGroup recognized andadministeredbytheGovernmentofIndia. covered undertheemployees’stateinsuranceschemes, whicharealsodefinedcontributionschemes fund administeredandmanagedbytheGovernmentofIndia. Inaddition,someemployeesoftheGroupare predetermined rate(presently12%)oftheemployees’ basic salary.Thesecontributionsaremadetothe contribution plan.Boththeemployeeandemployer makemonthlycontributionstotheplanata 167 7/21/2009, 9:23 PM 167

BHARTI AIRTEL ANNUAL REPORT 2008-09 or termination of employment based on the respective employee salary and years of employment with the Group. The Group provides for the Gratuity Plan based on actuarial valuations as per the Projected Unit Credit Method in accordance with Accounting Standard 15 (revised), “Employee Benefits“. The Group makes annual contributions to the LIC for the Gratuity Plan in respect of employees at certain circles. (f) Other Long term employee benefits are provided based on actuarial valuation made at the end of each financial year. The actuarial valuation is done as per projected unit credit method. (g) Actuarial gains and losses are recognized as and when incurred. 12. PRE-OPERATIVE EXPENDITURE Expenditure incurred by the Group from the date of acquisition of license for a new circle or from the date of start-up of new ventures or business, up to the date of commencement of commercial operations of the circle or the new venture or business, not directly attributable to fixed assets are charged to the Profit & Loss Account in the year in which such expenditure is incurred. 13. LEASES a) Where the Group is the lessee Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased term, are classified as operating leases. Lease Rentals with respect to assets taken on ‘Operating Lease’ are charged to the Profit & Loss Account on a straight-line basis over the lease term. Leases which effectively transfer to the Company substantially all the risks and benefits incidental to ownership of the leased item are classified as finance lease. Assets acquired on ‘Finance Lease’ which transfer risk and rewards of ownership to the Group are capitalized as assets by the Group at the lower of fair value of the leased property or the present value of the minimum lease payments or where applicable, estimated fair value of such assets. Amortization of capitalised leased assets is computed on the Straight Line method over the useful life of the assets. Lease rental payable is apportioned between principal and finance charge using the internal rate of return method. The finance charge is allocated over the lease term so as to produce a constant periodic rate of interest on the remaining balance of liability. b) Where the Group is the lessor Lease income in respect of ‘Operating Lease’ is recognised in the Profit & Loss Account on a straight-line basis over the lease term. Finance leases as a dealer lessor are recognized as a sale transaction in the Profit & Loss Account and are treated as other outright sales. Finance Income is recognized based on a pattern reflecting a constant periodic rate of return on the net investment of the lessor outstanding in respect of the lease. c) Initial direct costs are expensed in the Profit & Loss Account at the inception of the lease. 14. TAXATION Current Income tax and fringe benefit tax is measured at the amount expected to be paid to the tax authorities in accordance with Indian Income Tax Act, 1961. Deferred income taxes reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal of timing differences of earlier years. Deferred tax is measured at each balance sheet date based on the tax rates and the tax laws enacted or substantively enacted. Deferred tax assets and deferred tax liabilities across various countries of operation are not set-off against each other as the company does not have a legal right to do so. Deferred tax assets are recognised only to the extent that there is reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be realised. In situations where the Group has unabsorbed depreciation or carry forward tax losses, all deferred tax assets are recognised only if there is virtual certainty supported by convincing evidence that they can be realised against future taxable profits. Unrecognised deferred tax assets of earlier years are re- assessed and recognised to the extent that it has become reasonably certain that future taxable income will be available against which such deferred tax assets can be realized. Minimum Alternative Tax (MAT) credit is recognised as an asset only when and to the extent there is convincing evidence that the Group will pay normal income tax during the specified period. In the period/year in which the MAT credit becomes eligible to be recognized as an asset in accordance with the recommendations contained in guidance Note issued by the Institute of Chartered Accountants of India, the said asset is created by way of a credit to the Profit & Loss Account and shown as MAT Credit Entitlement. The Group reviews the same at each balance sheet date and writes down the carrying amount of MAT Credit Entitlement to the extent there is no longer convincing evidence to the effect that Group will pay normal Income Tax during the specified period.

6 Consolidated - Airtel 149-192.p65 168 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 3 CASHANDEQUIVALENTS 23. EMPLOYEESTOCKOPTIONSOUTSTANDING 22. PROVISIONS 21. AND ASSETRETIREMENTOBLIGATIONS(ARO) WARRANTY 20. EARNINGSPERSHARE 19. SEGMENTALREPORTING 18. IMPAIRMENTOFASSETS 17. BORROWINGCOST 16. MISCELLANEOUSEXPENDITURE 15. Cash andequivalentsintheBalanceSheetcomprise of cashinhandandatbankshort-terminvestments. and thefairvalueisrecognisedasanexpenseover period inwhichtheoptionsvest. Employee StockoptionsoutstandingarevaluedusingBlack Scholes/Latticevaluationoption–pricingmodel adjusted toreflectthecurrentbestestimates. required tosettletheobligationatbalancesheetdate.Thesearereviewedeachdateand can bemade.Provisionsarenotdiscountedtoitspresentvalueanddeterminedbasedonbestestimate not thatanoutflowofresourceswillberequiredtosettletheobligation,inrespectwhichareliableestimate Provisions arerecognisedwhentheGrouphasapresentobligationasresultofpastevent;itismorelikelythan Provision forwarrantyandAROisbasedonpastexperiencetechnicalestimates. the effectsofpotentialdilutiveequitysharesunlessimpactisantidilutive. for theeventsofbonusissue.ThedilutedEPSiscalculatedonsamebasisasbasicEPS,afteradjusting during theperiod/year.Theweightedaveragenumberofequitysharesoutstandingyearareadjusted The numberofsharesusedincomputingbasicEPSistheweightedaverageoutstanding The earningsconsideredinascertainingtheGroup’sEarningsperShare(‘EPS’)comprisenetprofitaftertax. SecondarySegment b) PrimarySegment a) identifiable cashflows(cashgeneratingunits). For thepurposeofassessingimpairment,assetsaregroupedatlowestlevelsforwhichthereseparately and valueinuse. exceeds itsrecoverableamount.Theamountisthehigherofassets’fairvaluelesscoststosell may notberecoverable.Animpairmentlossisrecognizedfortheamountbywhichassets’carrying are reviewedforimpairmentwhenevereventsorchangesincircumstancesindicatethatthecarryingamount The carryingamountsofassetsarereviewedateachbalancesheetdate.Assetsthatsubjecttoamortization recognised asanexpenseintheyearwhichtheyareincurred. time togetreadyforitsintendeduseiscapitalisedaspartofthecostthatasset.Otherborrowingcostsare Borrowing costattributabletotheacquisitionorconstructionoffixedassetswhichtakessubstantialperiod of therelatedcontract. Loss Accountovertheperiod Premium onredemptionofdebenturesisrecognisedasanexpenseintheProfit& portion beingattributabletoothers. The operationsinIndiaconstitutethemajorpart,whichisonlyreportablesegment,remaining The GrouphasoperationswithinIndiaaswellinothercountriesthroughentitieslocatedoutsideIndia. Services Carriers,EnterpriseCorporateandPassiveInfrastructureServices. The Groupoperatesinfiveprimarybusinesssegmentsviz.MobileServices,TelemediaEnterprise 169 7/21/2009, 9:23 PM 169

BHARTI AIRTEL ANNUAL REPORT 2008-09 Schedules annexed to and forming part of consolidated accounts SCHEDULE: 22 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2009 1. Background Bharti Airtel Limited (‘Bharti Airtel’ or ‘the Company’) incorporated in India on July 7, 1995, is a company promoted by Bharti Telecom Limited (‘BTL’), a company incorporated under the laws of India. 2. New Operations a) During the year ended March 31, 2009, the scheme of amalgamation (Scheme) for amalgamation of Bharti Aquanet Limited (‘Aquanet’) with the Company has been approved by the Hon’ble High Court and filed with the Registrar of Companies, National Capital Terrritory of Delhi & Haryana, (ROC) on January 1, 2009. Accordingly, all the assets and liabilities of erstwhile Aquanet are recorded by the Company under pooling of interest method effective January 1, 2009, being the date of filing of the scheme with ROC. b) During the year ended March 31, 2008, the Company had transferred its telecom infrastructure undertaking worth Rs. 57,396,005 thousand into a separate legal entity Bharti Infratel Limited (“BIL”) at Nil value pursuant to scheme sanctioned by The Hon’ble High Court of Delhi, effective from January 31, 2008. The Company had revalued its investment in BIL and recorded it at its fair value of Rs. 82,181,203 thousand. The reserve arising on business restructuring stood at Rs. 24,785,198 thousand in the balance sheet of the Company as of March 31, 2008. During the year ended March 31, 2009, the Company has, based on final reconciliation with BIL, transferred in/out certain assets and accounted these in accordance with the accounting prescribed in the Scheme resulting into net increase in the Business Restructuring Reserve (‘BRR’) and decrease in the net liabilities of the Company by Rs. 126,831 thousand for year ended March 31, 2009. Correspondingly, Rs. 126,831 thousand has been reflected as increase in the Liabilities and decrease in General Reserve. This reconciliation has no impact on the profits for the year ended March 31, 2009 or on the consolidated BRR as at March 31, 2009. The charge of additional depreciation has been withdrawn from Business Restructuring Reserve. The additional depreciation means depreciation charged by Bharti Infratel Limited on the respective assets transferred by Bharti Airtel in excess of that which would be chargeable on the original book value of these assets, as if there had been no revaluation or transfer of these assets under the demerger scheme sanctioned by the Hon’ble Delhi High Court. c) Bharti Airtel Services Limited has further invested in the Joint Venture “Forum I Aviation Limited” Rs. 5,500 thousand, in ordinary shares of Rs. 10 each, along with other partners, which is equivalent to an ownership interest of 14.28% as at March 31, 2009, taking the cumulative investment in the Joint Venture to Rs. 45,500 thousand (March 31, 2008 - Rs. 40,000 thousand, ownership interest 14.28%). d) Leading international investors have invested an amount of USD 1.35 billion in aggregate, towards 4,050 Equity Shares of Rs. 10 each (of which 225 shares issued on April 2, 2008) and 3,203,550 fully and compulsory convertible, non-cumulative, unsecured and interest free Debentures of Rs. 10,000 each (of which 177,975 Debentures issued as on April 2, 2008), in Bharti Infratel Limited. On August 21, 2008 Bharti Infratel Limited has issued 540,445,950 fully paid up bonus shares in ratio of 1:9,999 shares (face value of Rs. 10 each) by utilisation of its share premium account. e) During the year ended March 31, 2009, Bharti Airtel invested additional amount of Rs. 1,106,553 thousands in equity shares of its wholly owned subsidiary Bharti Airtel Holdings (Singapore) Pte. Limited. As of March 31, 2009 the amount is pending allotment by the subsidiary. f) On September 9, 2008, Bharti Airtel Limited subscribed to 5,717 thousand right shares of Bharti Hexacom Limited for an aggregate consideration of Rs. 343,062 thousand. g) During the year ended March 31, 2009, the Company contributed Rs. 2,049,411 thousand in its wholly owned subsidiary Bharti Airtel (Lanka) Private Limited towards equity. h) On October 9, 2008, Bharti Telemedia Limited, the subsidiary of the Company, has started its commercial operation to provide Direct to Home (‘DTH’) services. i) On January 20, 2009, Bharti Infratel Limited, in the Board Meeting, has approved for the demerger of undertaking comprising of Passive Telecom infrastructure in 12 Circles and merge thereof with Bharti Infratel Venture Limited, a wholly owned subsidiary of the Bharti Infratel Limited through Scheme of Arrangement. j) On February 19, 2009, the Company increased it’s stake in Bharti Hexacom Limited by 1.11% through acquisition of 2,780,306 equity shares for an aggregate consideration of Rs. 166,818 thousand.

6 Consolidated - Airtel 149-192.p65 170 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 .ContingentLiabilities 3. )Customsduty g) Accesscharges f) Incometaxdemand underappeal e) Servicetax d) Salestax c) ClaimsagainsttheGroupnotacknowledged asdebt:(Excludingcaseswherethepossibilityofanyoutflow b) TotalGuaranteesoutstandingasatMarch31,2009amountingtoRs.22,482,772thousand(March a) OnMarch4,2009,theCompanyhassubscribed1,470,000equityshares(49%stake)inBhartiTeleports k) imports should notbesubjecttoanycustom dutyasitwouldbean operating softwareexempt from any part ofthehardwarealong with whichthesamehasbeenimported.Theviewof the Groupisthatsuch 31, 2008-Rs.31,194thousand) fortheimportsofspecialsoftwareonground thatthiswouldform The customauthorities,insome states,demandedRs.2,289,442thousandasofMarch 31,2009(March under protest. and thatalossisnotprobable.Accordingly,noamounts havebeenaccruedalthoughsomepaid The managementbelievesthat,basedonlegaladvice,the outcomeofthesecontingencieswillbefavourable the Group. a statusquoorder,statingthatonlytheadmittedamounts basedontheguidelineswouldneedtobepaidby against thatdemandwiththeTelecomDisputesSettlement andAppellateTribunal(‘TDSAT’)whichpassed interconnect chargesattheratescontrarytoguidelines issuedbyTRAI.TheGroupfiledapetition governed bytheIUCguidelinesissuedTRAI.BSNLhas raisedademandrequiringtheGrouptopay Interconnect chargesarebasedontheIUCagreements between theoperatorsalthoughIUCratesare and, accordingly,recognitionofareserveforthosetax positions willnotbeappropriate. The managementbelievesthat,basedonlegaladvice,it isprobablethatitstaxpositionswillbesustained authorities againstthedisallowanceofcertainexpensesbeingclaimedundertaxbyincomeauthorities. Income taxdemandsunderappealmainlyincludedtheappealsfiledbyGroupbeforevariousappellate subscriberreceivableswrittenoff. ii. roamingrevenueschargedfromotheroperators;and i. 441,320 The servicetaxdemandsasofMarch31,2009relateto: theapplicablesalestaxondisposalsofcertainpropertyandequipmentitems. ii. theappropriatenessofdeclarationsmadebyGroupunder therelevantsalestaxlegislations 582,524 i. The claimsforsalestaxasofMarch31,2009comprisedthecasesrelatingto: contingencies willbefavourableandthatalossisnotprobable. Unless otherwisestatedbelow,themanagementbelievesthat,basedonlegaladvice,outcomeofthese Claimsunderlegalcasesincludingarbitrationmatters (ii) Taxes,DutiesandOtherdemands (i) in settlementisremote): Companies. 2008 Rs.1,198,890thousand)havebeengiventobanksandfinancialinstitutionsonbehalfofGroup Corporate GuaranteesoutstandingasatMarch31,2009amountingtoRs.1,576,542thousand(March Group. 2008 Rs.14,788,526thousand)havebeenissuedbybanksandfinancialinstitutionsonbehalfofthe Limited foranaggregateconsiderationofRs.14,700thousand. MncplTxs 3373,193 Asat 681,617 68,181 183,551 587,466 3,327 594,685 As at 66,034 31,194 684,937 which wasprimarilyproceduralinnature;and 1,556,436 362,579 2,289,442 405,526 demands miscellaneous -Other demands -DoT Charges -Access Taxes -Municipal below) h (see Tax -Entry Duty -Stamp below) g (see Duty -Customs Tax -Income Tax -Service below) c (see Tax -Sales (under adjudication/appeal/dispute) Particulars 171 1,7,1 7,530,808 10,979,313 7/21/2009, 9:23 PM 220032,239,974 2,210,023 1,735,072 2,005,446 ac 1 09March31,2008 March 31,2009 8,3 1,196,661 580,933 (Rs ‘000) 171

BHARTI AIRTEL ANNUAL REPORT 2008-09 custom duty. The management is of the view that the probability of the claims being successful is remote. h) Entry tax In certain states an entry tax is levied on receipt of material from outside the state. This position has been challenged by the Group in the respective states, on the grounds that the specific entry tax is ultra vires the constitution. Classification issues have been raised whereby, in view of the Group, the material proposed to be taxed not covered under the specific category. The amount under dispute as of March 31, 2009 was Rs. 1,556,436 thousand (March 31, 2008 - Rs. 587,466 thousand) included in Note 3 (b) above. i) DoT Demands i) The Group has received demands from DoT pertaining to Bharti Broadband Limited (now merged with Bharti Airtel Limited) amounting to Rs. 50,563 thousand against which an appeal has been filed before Hon’ble TDSAT (included in note 3 (b) above). The erstwhile promoter of Bharti Broadband Limited has undertaken to reimburse the Group in the event of the claim being payable. ii) The Group has not been able to meet its roll out obligations fully due to certain non-controllable factors like Telecommunication Engineering Center testing, Standing Advisory Committee of Radio Frequency Allocations clearance, non availability of spectrum, operational hazards, etc. The Group has received show cause notices from DoT for 14 of its circles for non-fulfillment of its roll out obligations. The Group is confident that this show cause notice would not result into liability. j) Others Others mainly include disputed demands for consumption tax, disputes before consumer forum and with respect to labour cases and a potential claim for liquidated damages. The management believes that, based on legal advice, the outcome of these contingencies will be favourable and that a loss is not probable. No amounts have been paid or accrued towards these demands. k) Bharti Mobinet Limited (‘BMNL’) litigation Bharti Airtel is currently in litigation with DSS Enterprises Private Limited (DSS) (0.34 per cent equity interest in erstwhile Bharti Cellular Limited (BCL)) for an alleged claim for specific performance in respect of alleged agreements to sell the equity interest of DSS in erstwhile BMNL to Bharti Airtel. The case filed by DSS to enforce the sale of equity shares before the Delhi High Court had been transferred to District Court and was pending consideration of the Additional District Judge. This suit was dismissed in default on the ground of non-prosecution. DSS had filed an application for restoration of the suit but has subsequently withdrawn the restoration application. In respect of the same transaction, Crystal Technologies Private Limited (‘Crystal’), an intermediary, has initiated arbitration proceedings against the Company demanding Rs. 194,843 thousand included in Note 3 (b) above regarding termination of its appointment as a consultant to negotiate with DSS for the sale of DSS stake in erstwhile BMNL to Bharti Airtel. DSS has also filed a suit against a previous shareholder of BMNL and Bharti Airtel challenging the transfer of shares by that shareholder to Bharti Airtel. The suit was subsequently dismissed as frivolous, which has been appealed to in the Delhi High Court by DSS and subsequently transferred to District Court. DSS has also initiated arbitration proceedings seeking direction for restoration of the cellular license and the entire business associated with it including all assets of BCL/BMNL to DSS or alternatively, an award for damages. An interim stay has been granted by the Delhi High Court with respect to the commencement of arbitration proceedings. The liability, if any, of Bharti Airtel arising out of above litigation cannot be currently estimated. Since the amalgamation of BCL and erstwhile Bharti Infotel Limited (BIL) with Bharti Airtel, DSS, a minority shareholder in BCL, has been issued 2,722,125 equity shares of Rs. 10 each bringing the share of DSS in Bharti Airtel down to 0.14% as at March 31, 2009. The management believes that, based on legal advice, the outcome of these contingencies will be favourable and that a loss is not probable. Accordingly, no amounts have been accrued or paid in regard to this dispute. 4. Export Obligation The Group obtained licenses under the Export Promotion Credit Guarantee (‘EPCG’) Scheme for importing capital goods at a concessional rate of customs duty against submission of bank guarantee and bonds. Under the terms of the respective schemes, the Group is required to export goods of FOB value equivalent to, or more than, five times the CIF value of imports in respect of certain licenses and eight times the duty saved in respect of licenses where export obligation has been refixed by the order of Director General Foreign Trade, Ministry of Finance, as applicable within a period of eight years from the import of capital goods. The Export Promotion Capital Goods Scheme, Foreign Trade Policy 2004-2009 as issued by the Central Government of India, covers both manufacturer exporters and service providers. Accordingly, in accordance with Clause 5.2 of the Policy, export of telecommunication services would also qualify. Accordingly the Group was required to export goods and services of FOB value of at least Rs. 2,733,073 thousand (March 31, 2008 - Rs. 1,213,014 thousand). 5. a) Estimated amount of contracts to be executed on capital account and not provided for (net of advances) Rs. 64,324,498 thousand (March 31, 2008 - Rs. 85,724,477 thousand). b) Under the IT Outsourcing Agreement, the Group has commitments to pay Rs. 8,127,823 thousand (March 31, 2008 - Rs. 8,009,806 thousand).

6 Consolidated - Airtel 149-192.p65 172 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 .EmployeeBenefits 6. b Theassumptionsusedtodeterminethebenefitobligationsareasfollows : (b) a Duringtheyear,GrouphasrecognizedfollowingamountsinProfit&LossAccount (a) icutRt .0 7.50% L – N.A. 7.50% Gratuity 7.50% – – 28,807 83,897 – – – 231,003 27,940 – 83,089 – 9,168 (4,803) – (4,803) Expected RateofReturnonPlanAssets 145,185 18,772 – 87,892 – 47,636 – Expected RateofincreaseinCompensationlevels 39,434 Discount Rate 97,549 – 56,308 Particulars – – (4,803) Net gratuity/Leaveencashmentcost 214,135 – 37,462 Curtailment andSettlementcost/(credit) – 131,018 Past servicecost 12,293 Actuarial (gain)/loss 6,484 Expected Returnonplanassets – (5,288) Interest cost 25,169 210,202 Current servicecost – 124,534 68,969 Particulars – 141,233 For theYearendedMarch31,2008 39,683 (5,288) # includedinSalaries,WagesandBonus(ReferSchedule16) Net gratuity/Leaveencashmentcost Curtailment andSettlementcost/(credit) Past servicecost 25,080 Actuarial (gain)/loss Expected Returnonplanassets Interest cost Current servicecost Particulars For theYearendedMarch31,2009 basis ofanactuarialvaluationonprojectedunitcreditmethodmadeattheendeachfinancialyear. Gratuity liabilityandleaveencashmentaredefinedbenefitobligationsprovidedforonthe Defined BenefitPlans @ IncludesContributiontoDefinedPlanforKeyManagerialPersonnel # IncludedinSalaries,WagesandBonus(ReferSchedule16) * IncludedinContributiontoProvidentandOtherFunds(ReferSchedule16) Employer’s ContributiontoESI* icutRt .0 7.50% L 7.50% Gratuity N.A. 7.00% 7.50% 7.00% years 25.85 years 25.85 Expected Averageremaining workinglivesofemployees(years) Expected RateofReturnon Plan Assets years 27.74 Expected Rateofincreasein Compensationlevels Discount Rate Particulars years 27.74 Previous yearAssumptions Expected Averageremainingworkinglivesofemployees (years) mlyrsCnrbto oSpranainFn ,6 1,173 530,316 617,843 2,162 Employer’s ContributiontoSuperannuationFund# Employer’s ContributiontoProvidentFund*@ Particulars Defined ContributionPlans Teefe .0 7.00% 15.00% 7.00% 15.00% ‘Thereafter ‘1st ThreeYears 173 : 9,1 2012141343,707 251,411 52,001 199,410 309,877 373,394 87,746 285,648 uddUfne oa Unfunded Total Unfunded Funded Unfunded Total Unfunded Funded rtiy#LeaveEncashment# Gratuity # LeaveEncashment# Gratuity # o h ereddFortheyearended For theyearended 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 eave Encashment eave Encashment (Rs. ‘000) (Rs. ‘000) (Rs. ‘000) 173

BHARTI AIRTEL ANNUAL REPORT 2008-09 (c) Reconciliation of opening and closing balances of benefit obligations and plan assets For the Year ended March 31, 2009 (Rs. ‘000) Particulars Gratuity Leave Encashment Funded Unfunded Total Unfunded Change in Projected Benefit Obligation (PBO) Projected benefit obligation at beginning of year 354,577 144,913 499,490 525,781 Current service cost 141,233 68,969 210,202 214,135 Interest cost 25,169 12,293 37,462 39,434 Benefits paid – (92,868) (92,868) (217,677) Curtailment and Settlement cost – – – – Contribution by plan participants – – – – Past service cost – – – – Actuarial (gain)/loss (4,281) 130,011 125,730 56,308 Projected benefit obligation at year end 516,698 263,318 780,016 617,981 Change in plan assets : Fair value of plan assets at beginning of year 70,502 – 70,502 – Expected return on plan assets 5,288 – 5,288 – Actuarial gain/(loss) (5,288) – (5,288) – Employer contribution 10,635 – 10,635 – Contribution by plan participants – – – – Settlement cost – – – – Benefits paid – – – – Fair value of plan assets at year end 81,137 – 81,137 – Net funded status of the plan (435,561) (263,318) (698,879) (617,981) Net amount recognized (435,561) (263,318) (698,879) (617,981) For the Year ended March 31, 2008 (Rs. ‘000) Particulars Gratuity Leave Encashment Funded Unfunded Total Unfunded Change in Projected Benefit Obligation (PBO) Projected benefit obligation at beginning of year 250,299 122,228 372,527 384,094 Current service cost 97,549 47,636 145,184 231,003 Interest cost 18,772 9,168 27,940 28,807 Benefits paid (21,529) (102,920) (124,449) (202,019) Curtailment and Settlement cost – – – – Contribution by plan participants – – – – Past service cost – – – – Actuarial (gain)/loss 9,486 68,801 78,287 83,896 Projected benefit obligation at year end 354,577 144,913 499,489 525,781 Change in plan assets : Fair value of plan assets at beginning of year 64,037 – 64,037 – Expected return on plan assets 4,803 – 4,803 – Actuarial gain/(loss) (4,803) – (4,803) – Employer contribution 27,994 – 27,994 – Contribution by plan participants – – – – Settlement cost – – – – Benefits paid (21,529) – (21,529) – Fair value of plan assets at year end 70,502 – 70,502 Net funded status of the plan (284,075) (144,913) (428,987) (525,781) Net amount recognized (284,075) (144,913) (428,987) (525,781) (d) The expected rate of return on plan assets was based on the average long-term rate of return expected to prevail over the next 15 to 20 years on the investments made by the LIC. This was based on the historical returns suitably adjusted for movements in long-term government bond interest rates. The discount rate is based on the average yield on government bonds of 20 years. (e) The estimates of future salary increases, considered in actuarial valuation, take account of inflation, seniority, promotion and other relevant factors, such as supply and demand in the employment market.

6 Consolidated - Airtel 149-192.p65 174 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 .InvestmentinJointVentures/Jointlyownedassets: 7. )BhartiAirtelServicesLimited (‘BASL’) enteredintoaJointVenturewith6otherpartiestoform anaircraft d) BhartiInfratelLimited hasenteredintoajointventureagreementonDecember8,2007withVodafone c) TheCompanyenteredintoaJointVenture with 9otheroverseasmobileoperatorstoformaregional b) Joint Ventures: TheCompanyhasparticipatedinvariousconsortiumstowardssupply,construction,maintenanceandproviding a) Jointly ownedassets: MovementinprovisionforDeferredIncentivePlan (i) h Thetablebelowillustratesexperienceadjustmentdisclosureasperpara120(n)(ii)ofAccountingStandard (h) Estimatedamountsofbenefitspayablewithin nextyearareRs.280,188thousand(March31,2008 (g) TheGroupmadeannualcontributionstotheLICofanamountadvisedbyLIC.wasnot (f) Particulars I rjc 5,8 5,8 7.09% 1.11% 10% 12.79% 7.08% – – 10.76% – – – 1,763,754 550,389 29,753 1,157,698 331,727 323,939 550,389 1,212,110 1,157,698 29,753 2,514,188 323,939 1,212,110 Unity -ProjectCommon IMEWE- Project EIG -Project EASSY -Project AAG -Project SMW-4 venture isoperating aircraftsoncharterbasis. BASLhasfurtherinvested intheordinarysharesof Rs.10 chartering companycalledthe ForumIAviationLimitedincorporatedinIndia.Theprincipal activityofthe thousand. shares ofRs.10eachinIndus TowersLimitedonDecember17,2007foranaggregate valueofRs.500 Towers Limited.Pursuantto theaforesaidagreement,BhartiInfratelLimitedhasacquired 50,000equity of BhartiInfratelLtdwhereintherelevantassetsareto betransferredforultimatemergerintheIndus Limited. ForthispurposeBhartiInfratelVenturesLimitedhas beenincorporatedasawhollyownedsubsidiary holds 42%eachintheIndusTowerLimitedandbalance 16%willbeheldbyAdityaBirlaTelecom provide passiveinfrastructureservicesin16circlesof India. TheCompanyandVodafoneEssarLimited Essar LimitedandIdeaCellulartoformanindependent towercompany(“IndusTowersLimited”)to 10.00%). 265,131 at March31,2009(March31,2008:USD2,200thousands Rs.92,237thousand,ownershipinterest % Share 2,200 thousandordinarysharesofUSD1eachwhichis equivalenttoanownershipinterestof10.00%as 108,267 Alliance Programme.TheGrouphasinvestedUSD2,200 thousand,amountingtoRs.92,237in 233,555 activity oftheventureiscreatinganddevelopingregional mobileservicesandmanagingtheBridgeMobile alliance calledtheBridgeMobileAllianceincorporatedin SingaporeasBridgeMobilePteLtd.Theprincipal WDVAsat 139,843 572,216 Work Capital 133,191 Contribution Total – Project Cable – follows: long termtechnicalsupportwithregardstofollowingCableSystems.Thedetailsofthesameareas 19,182 – (69,906) (25,407) Closing Balance 37,174 Less :Utilizedduringtheyear 64,037 Addition duringtheyear Opening Balance (61,424) 70,502 384,094 (82,041) 525,781 81,137 (428,987) 617,981 (698,879) 372,527 Experience adjustmentson plan liabilities 499,489 Experience adjustmentson Surplus /(deficit) 780,016 Plan assets Defined benefitobligation nt rjc ih p4,4 051–13.91% – 40,541 40,541 – Unity -ProjectLightUp – – 394 (4,803) (5,288) Particulars plan assets 15, ‘EmployeeBenefits’ Rs. 244,312thousand). informed byLICoftheinvestmentsmadeorbreak-downplanassetsinvestmenttype. 175 ne ac ne ac ne ac ne ac ne ac endedMarch endedMarch endedMarch endedMarch endedMarch ended March o h erFrteya o h erFrteya o h erFortheyear Fortheyear Fortheyear Fortheyear Fortheyear For theyear 1 093,20 1 073,20 1 0831,2007 31,2008 31,2009 31,2007 31,2008 31, 2009 (Rs ‘000) (Rs ‘000) (Rs ‘000) (Rs (Rs‘000) (Rs ‘000) Gratuity 3840 6791 5571 (384,094) (525,781) (617,981) (308,490) nPors March 31, 2009 Progress In o h ereddFortheyearended For theyearended 7/21/2009, 9:23 PM ac 1 09March 31,2008 March 31,2009 7,6 139,843 578,868 Leave Encashment (Rs. ‘000) 175

BHARTI AIRTEL ANNUAL REPORT 2008-09 each amounting to Rs. 5,500 thousand along with other partners, which is equivalent to an ownership interest of 14.28% as at March 31, 2009, taking the cumulative investment in the Joint Venture to Rs. 45,500 thousand (March 31,2008: Rs. 40,000 thousand, ownership interest 14.28%). e) The following represent the Group’s share of assets and liabilities, and income and results of the joint ventures after elimination of transactions between joint ventures and the Company to the extent of its proportionate share which are included in the Balance Sheet and Profit and Loss Account respectively. (Rs. ‘000) Particulars As at As at March 31, 2009 March 31, 2008 Balance Sheet Reserve and surplus (738,920) (34,370) Fixed assets, (net) 28,252,977 13,782 Investments 2,824 23,133 Current assets Sundry Debtors 4,569,743 3,538 Cash and bank 2,041,987 60,452 Loans and advances 5,604,738 34,504 Current liabilities and provisions 18,117,789 27,802 Deferred Tax Liability 376,982 – Unsecured Loans 15,562,449 10,975 Secure Loan 7,770,000 – (Rs. ‘000) Particulars For the year ended For the year ended March 31, 2009 March 31, 2008 Profit and Loss Account Service revenue 8,946,430 17,563 Other income 41,263 27,872 Expenses Operating expenses 7,894,247 27,316 Selling, general and administration expenses 210,135 35,311 Finance expenses/(income) 1,051,728 (1,367) Depreciation 925,915 4,027 Charity and Donation 221 – Deferred Tax liability (376,982) – Fringe Benefit Tax 6,198 – Profit/(Loss) (723,769) (19,852) Contigent Liability 10,160,782 7,728 Capital Commitment 165 – 8. Goodwill The following is the detail of goodwill in the consolidated financial statements of Bharti Airtel as at March 31, 2009: (Rs. ’000) Nature of transaction As at As at March 31, 2009 March 31, 2008 On Acquisition of 70 per cent equity interest (Previous year 68.89 per cent) in BHL by Bharti Airtel 3,067,862 3,056,346 100 per cent equity interest in SBEL by Bharti Airtel 31,070 31,070 100 per cent equity interest in BBL by SBEL 92,860 92,860 10 per cent in Bridge Mobile Pte Ltd, the joint venture Company 4,649 4,649 100 per cent equity interest in Bharti Aquanet Limited by Bharti Airtel 33,578 33,578 100 per cent equity interest in Network i2i by Bharti Airtel 5,395,355 5,395,355 Total 8,625,374 8,613,858

6 Consolidated - Airtel 149-192.p65 176 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 13. 12. 11. 10. 9. Total Vehicle LoanfromBank Loan fromBank Loan fromBank 813,218 1,627,837 875,829 commencing fromDec2009 thousand eachrepayment Redeemable DebenturesofRs.10,000 1,000,163 1,507,331 11.70%, 50Non-convertible 1,216,200 1,763,221 Particulars 1,852,275 Particulars ofsecuritieschargedagainstsecuredloanstakenbytheGroupareasfollows: Rs. 348,853thousand(March31,2008-291,774thousand). Sales andMarketinginSchedule17includesgoodwillwaiverswhichareotherthantradediscountof paid up. are heldbyBhartiTele-VenturesEmployee’sWelfareTrust,issuedattherateofRs.51.36perequitysharefully As atMarch31,2009,2,090,245equityshares(March2008-2,317,645shares)oftheCompany security depositreceivedfromthem. Sundry debtorsaresecuredtotheextentofamountoutstandingagainstindividualsubscribersbyway repayable ondisconnection,netofoutstanding,ifanyandsecuritydepositsreceivedfromchannelpartners. refundable securitydepositsreceivedfromsubscribersonactivationofconnectionsgrantedtheretoandare Rs. 3,728,953thousand(March31,2008-3,666,023thousand)includedunderCurrentLiabilities,represents * ReferNote2(b)onSchedule22 Total Share ofcurrentYearProfit/(Loss) Share ofOpeningReserve Reserve arisingunderScheme Share Premium Share Capital Particulars follows: attributable tointerestswhicharenotowned,directlyorindirectlythroughsubsidiary(ies)byBhartiAirtelas Minority interestrepresentsthatpartofthenetresultsoperationsandassetsasubsidiary )Licensesissued byDoTtoprovidevarioustelecom services. c) InvestmentinsubsidiariesofBhartiAirtel. b) Intellectualpropertiesof BhartiAirtel. a) Note: Followingshallbeexcluded fromSecuritiesasmentionedabove: 177 of Arrangement* 14,287,304 mutOttnigSecuritycharges Amount Outstanding 7,770,000 6,000,000 500,000 17,304 (Rs ’000) } Company Secured byHypothecationofVehiclesthe Limited. accessories, excludingreceivablesofIndusTower assets (towerassets),machineryspares,toolsand hypothecation overthepresentandfuturemovable Secured byparipassufirstchargewayof • • • fixtures, sparestoolsandaccessories. machinery, officeequipment,furnitureand Bharti InfratelLimitedincludingplantand immovable assets(excludingland)ownedby on allpresentandfuturetangiblemovable First rankingparipassuchargeandequitable insurance policies. from andinprojectdocuments,bookdebts monies depositedandinvestmentsmadethere All rights,titles,interestsintheaccounts,and accessories and fixturesfittings,sparestools plant andmachinery,officeequipment,furniture assets ownedbyBhartiAirtelLimitedincluding and futuretangiblemovableimmovable First rankingparipassuchargeonallpresent 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 2275010,142,236 12,297,540 ,5,1 5,825,189 5,958,513 sa Asat As at (Rs. ‘000) 177

BHARTI AIRTEL ANNUAL REPORT 2008-09 14. The movement of provision made for site restoration cost and warranty charges in accordance with AS–29 ‘Provisions, Contingent liabilities and Contingent Assets’ notified under Companies (Accounting Standards) Rules, 2006, (‘As amended’) is given below: i) Site Restoration Cost: (Rs. ‘000) Particulars For the year ended For the year ended March 31, 2009 March 31, 2008 Opening Balance 5,801,180 3,477,951 Addition during the year 4,757,973 2,323,180 Closing Balance 10,559,153 5,801,131 ii) Warranty Charges: (Rs. ‘000) Particulars For the year ended For the year ended March 31, 2009 March 31, 2008 Opening Balance 7,528 2,263 Addition during the year 9,989 9,296 Less: Utilised/reversed during the year 14,459 4,031 Closing Balance 3,058 7,528

15. Information about Business Segments - Primary For the year ended March 31, 2009 (Rs. ‘000) Reportable Mobile Telemedia Enterprises Enterprise Passive Others Eliminations Total Segments Services Services Services Services Infra- Carriers Corporate structure Revenue Service Revenue/Sale of Goods and Other Income 295,944,616 31,230,090 22,305,505 12,410,940 12,707,127 446,346 - 375,044,624 Inter Segment Revenue 8,243,851 2,195,943 45,929,412 4,022,921 38,205,845 3,553,882 (102,151,854) - Total Revenue 304,188,467 33,426,033 68,234,917 16,433,861 50,912,972 4,000,228 (102,151,854) 375,044,624 Results Segment Result, Profit/(Loss) 68,746,069 8,187,883 25,709,297 5,927,956 3,204,243 (6,860,931) (391,559) 104,522,958 Net Finance Expense/( Income ) - - - - - 18,612,828 - 18,612,828 Net Profit / (Loss) 68,746,069 8,187,883 25,709,297 5,927,956 3,204,243 (25,473,759) (391,559) 85,910,130 Provision for Tax - Current Tax inclusive of MAT credit - - - - - 8,082,305 - 8,082,305 - Fringe Benefit Tax - - - - - 408,131 - 408,131 - Deferred Tax (Credit)/Charge - - - - - (3,022,126) - (3,022,126) Minority Interest 1,684,463 - - - 167,812 - - 1,852,275 Net Profit / (Loss) after tax 67,061,606 8,187,883 25,709,297 5,927,956 3,036,431 (30,942,069) (391,559) 78,589,545 Other Information Segment Assets 233,283,156 49,695,333 67,169,802 12,569,123 202,578,918 58,824,123 - 624,120,455 Inter Segment Assets 143,765,234 17,019,515 83,586,494 18,134,560 17,488,997 5,273,054 (285,267,855) - Deferred Tax Asset - - - - - 292,978 - 292,978 MAT Credit ------Total Assets 377,048,390 66,714,848 150,756,296 30,703,683 220,067,915 64,390,155 (285,267,855) 624,413,433 Segment Liabilities 99,760,222 8,014,601 24,199,314 6,648,945 94,680,802 87,532,765 - 320,836,649 Inter Segment Liabilities 73,289,611 47,746,070 64,186,124 5,567,882 18,182,791 76,295,377 (285,267,855) - Minority Interest 4,540,707 - - - 7,756,833 - - 12,297,540 Deferred Tax Liability ------Total Liabilities 177,590,540 55,760,671 88,385,438 12,216,827 120,620,426 163,828,142 (285,267,855) 333,134,189 Capital Expenditure 84,543,496 16,717,260 17,926,151 3,196,169 62,352,487 3,863,082 (21,653,937) 166,944,708 Depreciation and amortisation 26,143,730 6,102,576 4,779,423 1,663,136 12,709,477 1,029,545 (2,788,905) 49,638,982

6 Consolidated - Airtel 149-192.p65 178 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 eerdTxAst------2,729,149 765,146 10,142,236 - - - - - (398,625) 2,729,149 - 765,146 - - - 9,353,297 402,986 ------(398,625) 1,000,163 (1,196,238) - - - - - 9,353,297 - 402,986 5,278,690 ------(1,196,238) 38,102,363 - 244,244,090 - - (1,611,831) 257,115,475 - - - - - (223,120,585) 467,067 65,886,963 - 5,278,690 - - 131,092,360 - - 8,656,456 1,524,097 28,639 - 473,594,155 - - 64,455,690 474,359,301 - 1,085,650 26,475,784 - - (223,120,585) - 41,380,543 28,202,585 (223,120,585) 36,682,030 - 48,585,915 3,655,903 - 168,764,048 235,086,297 - - 82,506,445 (223,120,585) - 7,052,951 123,620 21,253,879 5,536,379 1,603,505 - 103,502,821 20,237,445 10,142,236 63,953,891 - 27,313,819 44,926,487 27,445,098 75,097,903 44,218,245 - 7,462,959 - Total (567,550) 159,988,394 264,507,817 9,253,769 3,954 33,917,584 12,000,110 - 73,115,474 134,429,036 - - 24,192,776 (17,632,991) 50,734,388 52,768,433 (567,550) 1,214,113 - 40,938,828 3,987,659 - Depreciation andamortisation Eliminations - (61,200) Capital Expenditur 5,245,003 (9,471,571) 182,618,616 - Infra- Others 81,889,201 272,918,496 Total Liabilities 1,242,752 272,918,496 Deferred TaxLiability 11,285,504 - - 1,028,770 78,394,164 (40,637,069) Provision fortax(NetofAdvanceTax) 6,169,850 5,245,003 2,536,863 Minority Interest (567,550) - Passive Inter SegmentLiabilities Services (40,637,069) 58,239,962 11,289,458 - Segment Liabilities 6,023,207 2,430,981 (4,192,881) Total Assets 6,108,650 13,884,988 MAT Credit Enterprise 1,242,752 Services 5,820,260 105,882 Deferred TaxAsset 59,268,732 43,798,095 Inter SegmentAssets 5,245,003 3,362,085 Enterprises Segment Assets 28,615,149 - 202,947 Services Other Information 218,697,263 11,289,458 22,518,216 Telemedia Net Profit/(Loss)aftertax Minority Interest 6,108,650 1,204,345 10,522,903 Services MAT Credit Mobile - DeferredTax(Credit)/Charge 21,279,879 59,268,732 5,301,182 - FringeBenefitTax 27,410,804 - CurrentTax Provision forTax 213,396,081 Net Profit/(Loss) Net FinanceExpense/(Income) Segment Result,Profit/(Loss) Results Total Revenue Inter SegmentRevenue Goods andOtherIncome Service Revenue/Saleof Revenue Segments Reportable For theyearendedMarch31,2008 of DirecttoHomeServices. not chargedtoindividualsegments. Otheroperationalsoincludesrevenues,profits/(losses), assetsandliabilities Group noneofwhichconstitutes aseparatelyreportablesegment.Thecorporateheadquarters’ expensesare Other operations transmission businessinandoutofIndia. communication towers,providenetworkdevelopmentservices andtoengageinvideo,voice,datainternet Passive InfrastructureServices and othernetworksolutionstocorporatecustomers. Enterprise ServicesCorporate providers routetheirlongdistancecallsi.e.outsidelocal boundariesofacityarea. provided totheserviceprovidersofcellularorfixedline services.Usingtheseservices,otherservice Enterprise ServicesCarriers equipment (i.e.switch)tosubscriber’spremises. line connectivitytothesubscriber.Theend-userequipment isconnectedthroughcablesfrommainnetwork Telemedia Services(formerlyBroadbandandTelephoneServices) anywhere andstayconnectedwhereverthewirelessnetworkcoverageisavailable. subscriber isconnectedtothenetworkthroughwirelessequipment.Thecanfreelyroamaround Mobile Services Segment Definitions 179 –Theseservicescovertelecomprovidedthroughcellularmobiletechnologywhereina e — Thesecomprisetheunallocatedrevenues,profits/ (losses), assetsandliabilitiesofthe — Thedomesticandinternationallongdistanceservices areintermediaryservices

— Theseservicesincludeinternetservices,broadband providingbandwidth — Theseservicesincludesettingup,operatingandmaintaining wireless 105061,6,8 735886679416579222702(69365 218,043,289 (26,973,615) 2,247,002 116,597,942 6,667,994 17,365,848 11,063,082 91,075,036 — Theseservicesareprovidedthroughwire- 7/21/2009, 9:23 PM aresCroaestructure Corporate Carriers (Rs. ‘000) 179

BHARTI AIRTEL ANNUAL REPORT 2008-09 Notes: 1. Others represents the Unallocated Revenue, Profit/(Loss), Assets and Liabilities. 2. Segment results represents Profit/(Loss) before Finance Expenses and Tax. 3. Capital expenditure pertains to gross additions made to fixed assets during the year excluding goodwill. 4. Segment Assets include Fixed Assets, Capital Work in Progress, Pre-operative Expenses Pending Allocation, Investments, Current Assets and Miscellaneous Expenditure to the extent not written off. 5. Segment Liabilities include Secured and Unsecured loans, Current Liabilities and Provisions. 6. Inter segment Assets/Liabilities represent the inter segment account balances. 7. Inter segment revenues excludes the provision of telephone services free of cost among group companies. Others are accounted for on terms established by management on arm’s length basis. These transactions have been eliminated in consolidation. 8. The accounting policies used to derive reportable segment results are consistent with those described in the “Significant Accounting Policies” note to the financial statements. Also refer Note 18 - Policy of significant accounting policy of Segment reporting of Schedule 22. Information about Geographical Segment – Secondary The Group has operations within India as well as with entities located in other countries. The information relating to the Geographical segments in respect of operations within India, which is the only reportable segment, the remaining portion being attributable to others, is presented below for the year ended March 31, 2009. (Rs. ‘000) As at As at Particulars March 31, 2009 March 31, 2008 Segment Revenue from external customers based on geographical location of customers (including Other Income) Within India 354,157,278 256,863,565 Others 20,887,346 16,054,931 375,044,624 272,918,496 Carrying amount of Segment Assets by geographical location Within India 592,622,311 466,967,501 Others 31,791,122 7,391,800 624,413,433 474,359,301 Cost incurred during the year to acquire segment assets by geographical location Within India 158,033,878 215,207,988 Others 8,910,830 2,835,301 166,944,708 218,043,289 Notes: 1. ‘Others’ represents the Unallocated Revenue, Assets and acsquisition of Segment Assets of the Group. 2. Assets include Fixed Assets, Capital Work in Progress, Investments, Current Assets and Miscellaneous Expenditure to the extent not written off. 3. Cost incurred to acquire Segment Assets pertains to gross additions made to Fixed Assets during the year.

6 Consolidated - Airtel 149-192.p65 180 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 6 RelatedPartyDisclosures 16. * MergedwithBhartiRealtyPrivateLimited Bharti TeleportsLimited Bharti AXAInvestmentManagersPrivateLimited Bharti AXAGeneralInsuranceCo.Limited Jataayu SoftwareLimited Centum LearningLimited(FormerlyBhartiSystemLimited) Jersey AirtelLimited Bharti AXALifeInsuranceCo.Ltd Primerose ProjectsPrivateLimited* Bharti DelMonteIndiaPrivateLimited Guernsey AirtelLimited Telecom (Seychelles)Limited Bharti TelecomLimited Tamarind ProjectsPrivateLimited Bharti ReatlyPrivateLimited(FormerlyJasmineProjectsLimited) Bharti ElectoralTrust Bharti Foundation Bharti RetailPrivateLimited Bharti EnterprisesLimited Bharti Wal-MartPrivateLimited Bharti Tele-VenturesEmployeesWelfareTrust Bharti TeletechLimited Comviva TechnologiesLimited(FormerlyBhartiTelesoftLimited) Entities whereKeyManagementPersonnelexercisessignificantinfluence/GroupCompanies Singapore TelecommunicationsLimited Entity havingsignificantinfluence Name oftheRelatedPartyandRelationship Other RelatedParties Manoj Kohli Akhil Gupta Sunil BhartiMittal Key ManagementPersonnel: List ofRelatedParties description ofrelationships,asidentifiedandcertifiedbythemanagementare: of therelatedpartieswherecontrolexistsand/orwithwhomtransactionshavetakenplaceduringyearand In accordancewiththerequirementsofAccountingStandards(AS)-18onRelatedPartyDisclosures,names 181 : 7/21/2009, 9:23 PM 181

BHARTI AIRTEL ANNUAL REPORT 2008-09 6 Consolidated -Airtel149-192.p65

Related Party Transaction for 2008-09 (Rs ‘000) Nature of transaction Bharti Singapore Bharti Comviva Bharti Telecom Jasmine Guernsey Tamarind Jasmine Bharti Primerose Telecom Telecommu- Wal-Mart Techno- Teletech Seychelles Projects Airtel Projects Projects Del Monte Projects Limited nications Private logies Limited Limited Private Limited Private Private India Private Limited Limited Limited Limited Limited Limited Private Limited Limited

182 Purchase of fixed assets – – – (17,125) (1,057,542) – (44,307) – – – – – Sale of fixed assets –––––––––––– Purchase of Investments (Mutual Fund) Sales of Investments (Mutual Fund) Rendering of services – 1,549,602 1,328 22,499 102,508 15,064 – 4,165 – – – – Receiving of services – (817,723) – (806,197) (100,690) (12,434) – – – – – – Fund transferred/includes expenses incurred on behalf of others ––––1,410–126,293 – 14,622 17,474 – – Fund received/includes expenses incurred on behalf of Company – – – (686) (5,737) –––––447– Employee related transaction incurred on behalf of others ––––54––––––– Employee related transaction incurred on behalf of Company ––––––––––(1,034) – Salary Donation –––––––––––– Amount received on exercise of ESOP options Security deposit/Advances paid ––––––259,979 – – – – – Security deposit/Advances received ––––(53,600) ––––––(188,991) Subscription to share capital Share Capital issued Loan from Group Companies –––––––––––– Loan to Related Party

7/21/2009, 9:23 PM Subscription to share capital Interest received on fund transferred ––––––––––––

Closing balance 9,078 531,594 437 (242,405) 25,952 738 594,779 10,160 ––447 – Unsecured Loan –––––––––––– Creditors – – – (242,405) –––––––– Loans and Advances ––––25,952 738 594,779 10,160 – – – – Debtors – 531,594 437 – ––––––––

Closing Balance 9,078 531,594 437 (242,405) 25,952 738 594,779 10,160 ––447 – Maximum Loans and Advances outstanding during the year ––––25,952 738 594,779 10,160 – – 447 – Guarnatess and Collaterals 6 Consolidated -Airtel149-192.p65

Related Party Transaction for 2008-09 (Rs ‘000)

Bharti Bharti Bharti Jersey Bharti Centum Bharti Jataayu Bharti Bharti Axa Bharti Sunil Akhil Manoj AXA Life Foundation Tele- Airtel Enterprises Learning Retail Software Ltd Axa General Investment Teleports Bharti Gupta * Kohli Nature of transaction Insurance ventures Limited Limited Limited (Formally Private Insurance Managers Limited Mittal Co. Ltd Employee Bharti Learning Limited Co Ltd Private Welfare Trust System Limited) Limited

183 Purchase of fixed assets –––– – ––––––––– Sale of fixed assets –––– –13,650 – – – – –––– Purchase of Investments (Mutual Fund) –––– – ––––(1,210,027) –––– Sales of Investments (Mutual Fund) –––– – ––––911,887–––– Rendering of services 23,887 – – 43,559 1,134 45 17,184 1,552 – – –––– Receiving of services (51) – – (477) – (208,560) – – (10,076) – –––– Fund transferred/includes expenses incurred on behalf of others –––– 7128,850 13,694 – – – –––– Fund received/includes expenses incurred on behalf of Company ––––(223,834) (6,149) (3,936) – (634) – –––– Employee related transaction incurred on behalf of others –––– – –5,131 – – – –––– Employee related transaction incurred on hehalf of Company – (3,079) – (365) (6,210) (25,721) (8,248) – – – –––– Salary –––– – ––––––228,97760,579 25,958 Donation – 103,188 – – – – – – – – –––– Amount received on exercise of ESOP options – – (11,679) – – – – – – – –––– Security deposit/Advances paid –––– – ––––––––– Security deposit/Advances received –––– – ––––––––– Subscription to share capital –––– – ––––––––– Share Capital issued –––– – ––––––––– Loan from Group Companies –––– – ––––––––– Loan to Related Party –––– – ––––––––– Subscription to share capital –––– – –––––14,700 – – –

7/21/2009, 9:23 PM Interest received on fund transferred –––– – –––––––––

Closing balance 23,740 - 107,364 31,672 470 62,669 6,210 230 – – – (110,000) (24,733) (7,989) Unsecured Loan –––– – ––––––––– Creditors –––– – ––––––(110,000) (24,733) (7,989) Loans and Advances 23,740 – 107,364 31,672 470 62,669 6,210 230 – – –––– Debtors –––– – –––––––––

Closing Balance 23,740 - 107,364 31,672 470 62,669 6,210 230 - - - (110,000) (24,733) (7,989) Notes: * Ceased to be Joint Managing Director with effect from August 1, 2008. 183

BHARTI AIRTEL ANNUAL REPORT 2008-09 6 Consolidated -Airtel149-192.p65

Related Party Transaction for 2007-08 (Rs ‘000) Nature of transaction Singapore Bharti Comviva Bharti Bharti Tamarind Bharti Bharti Bharti Bharti Bharti Bharti Manoj Telecommuni- Wal-Mart Technologies Teletech Realty Projects Foundation Enterprises Retail Electoral Tele- Venture- Kohli cation Limited Private Limited Limited Private Private Limited Private Trust Ventures tech Limited Limited Limited Limited Employee’s Limited Welfare Trust

184 Purchase of fixed assets – – (14,179) (1,543,914) – – – –––––– Sale of fixed assets ––––––15,642 ––––– Rendering of services 1,164,107 681 4,524 5,939 – – – 31 202 –––– Receiving of services (1,960,328) – (556,707) (89,785) (52,486) (8,666) – –––––– Fund transferred/includes expenses incurred on behalf of others 79,265 – – 53,607 189,122 – – 3,263 1,998 –––– Fund received/includes expenses incurred on behalf of Company (850,013) – – (77) – – – (36,586) (1,994) –––– Employee related transaction incurred on behalf of others – 454 – – 1,222 – – – 5,085 –––– Employee related transaction incurred on behalf of Company – – – – (440) – – (15,873) (10,463) –––– Salary – –––––––––––32,087 Donation – –––––104,441 – – 200,000 – – – Amount received on exercise of ESOP options – –––––––––(14,750) – – Purchase of shares of Subsidiary Companies (2,658,020) ––––––––––(2,658,020) –

Closing balance 110,279 147 3,252 (50,515) 523,791 ––13,015 (3,197) – 119,043 –– Unsecured Loan – –––––––––––– Creditors – – – (50,515) – – – –––––– Loan and Advances – – 3,252 – 523,791 – – 12,900 – – 119,043 – – Debtors 110,279 147 –––––115(3,197) –––– 7/21/2009, 9:23 PM Closing Balance 110,279 147 3,252 (50,515) 523,791 ––13,015 (3,197) – 119,043 –– Maximum Loans & Advances – – 3,252 – 523,791 – – 12,900 – – 119,043 – – during the year

Note: 1) Payment made to Key Management Personnel (excluding Manoj Kohli) is Rs. 264,498 thousand (March 31, 2007: Rs. 232,182 thousand) 6 Consolidated -Airtel149-192.p65 7 Leases 17. ae hnfv er 9494440,396,172 8,937,331 4,966,705 59,479,474 17,793,314 17,248,848 19,348,131 41,385,602 OperatingLease–AsaLessor b) and therearenorestrictionsimposedonleasearrangements. The escalationclauseincludesrangingfrom0to50%,optionofrenewal199years Total Later thanfiveyears Later thanoneyearbutnotlaterfiveyears Not laterthanoneyear Obligations onnoncancelableleases: Lease Rentals Particulars Operating Lease–AsaLessee a) atclr Gross Particulars As atMarch31,2009 FinanceLease–AsaLessor d) ServiceCharges–AsaLessor c) oa ,5 62,558 96 2,342 Gross 2,654 94 216 2,436 2 218 Particulars As atMarch31,2008 Total Later thanoneyearbutnotlaterfiveyears Not laterthanoneyear oa 1766711,119 607 8,243 11,726 513 2,876 8,756 94 2,970 Total Later thanoneyearbutnot later thanfiveyears Not laterthanoneyear oa 759374,255,738 17,509,387 2,368,559 377,436 9,036,409 1,652,438 1,509,743 6,820,540 TheGrouphasenteredintoanon-cancelableleasearrangementtoprovideaccessthePassive iv) ThegrouphasacquiredProperty,PlantandEquipmentbymeansoffinanceleasetotheaggregatevalue iii) Total Later thanfiveyears Later thanoneyearbutnotlaterfiveyears Not laterthanoneyear Particulars Thefutureminimumleasepaymentsreceivableare: ii) TheGrouphasenteredintoanon-cancelableleasearrangementtoprovideapproximately100,000fiber i) leases areasfollows: premises andcellsitesaspertheagreementsmaximumobligationonlong-termnon-cancelableoperating The leaserentalschargedduringtheyearforcancelable/non-cancelableleasesrelatingtorentofbuilding the totalofminimumleasepaymentsasatMarch31,2009 andtheirpresentvalueisasfollows: During theyearGrouphasgivencertainVSATassets underfinancelease.Thereconciliationbetween for cellsitesaspertheagreementsisRs.227,560thousand. The servicechargesrecognizedasincomeduringtheyearforcancelablearrangementsrelatingtoservices credited totheProfitandLossAccountonastraight-linebasisoverleaseterm. its JointVentureCompany,IndusTowerLimitedfromJanuary1,2009.Theleaserentalreceivableis Infrastructure locatedat12Circlesonindefeasiblerightofuse(IRU)basisforaperiod6monthsto of 468,638thousand(March31,2008Nil). 19 arenotprovided. of theassetgivenonoperatingleaseasatMarch31,2009andaccordingly,disclosuresrequiredbyAS not possibletocomputegrosscarryingamount,depreciationfortheyearandaccumulated and LossAccountonastraight-linebasisovertheleaseterm.Duetonatureoftransaction,itis rental receivableproportionatetoactualkilometersacceptedbythecustomeriscreditedProfit pair kilometersofdarkfiberonindefeasiblerightuse(IRU)basisforaperiod18years.Thelease 185 netetIcm Value Income Investment netetIcm Value Income Investment 7/21/2009, 9:23 PM Unearned Finance Unearned Finance ac 1 09March31,2008 March 31,2009 ac 1 09March31,2008 March 31,2009 1,1,2 64,711,008 118,113,924 sa Asat As at Asat As at (Rs. ‘000) (Rs. ‘000) (Rs. ‘000) (Rs. ‘000) Present Present 185

BHARTI AIRTEL ANNUAL REPORT 2008-09 e) The Company entered into a composite IT outsourcing agreement, whereby the vendor supplied fixed assets and IT related services to the Company. Based on the risks and rewards incident to the ownership, the fixed assets received are accounted for as a finance lease transaction. Accordingly, the asset and liability are recorded at the fair value of the leased assets at the time of receipt of the assets, since it is not possible for the Company to determine. These assets are depreciated over their useful lives as in the case of the Company’s own assets. Since the entire amount payable to the vendor towards the supply of fixed assets during the year is accrued, there are no minimum lease payments outstanding as at the year-end in relation to these assets and accordingly, other disclosures as per AS 19 are not applicable. There are no restrictions imposed on lease arrangements. 18. The breakup of Net Deferred Tax Asset/(Liability) into major components of the respective balances is as follows: (Rs. ‘000) As at As at March 31, 2009 March 31, 2008 Provision for doubtful debts/advances charged in financial statement but allowed as deduction under the Income Tax Act in future years (to the extend considered realisable) 4,402,962 3,237,404 Depreciation claimed as deduction under Income Tax Act but chargeable in the financial statement in future years (12,930,773) (7,312,535) Other expenses claimed as deduction in the financial statement but allowed as deduction under Income Tax Act in future year on actual 3,014,334 241,495 Foreign exchange fluctuation and MTM losses charged in financial statement but allowed as deduction under the Income Tax Act in future years (by way of depreciation and actual realisation, respectively) 5,043,597 695,095 Brought Forward Loss 762,858 409,392 Net Deferred Tax Assets/(Liability) 292,978 (2,729,149) The tax impact for the above purpose has been arrived at by applying a tax rate of 33.99% being the substantively enacted tax rate for Indian companies under the Income Tax Act, 1961. 19. Employee stock compensation (i) Pursuant to the shareholders’ resolutions dated February 27, 2001 and September 25, 2001, the Company introduced the “Bharti Tele-Ventures Employees’ Stock Option Plan” (hereinafter called “the Old Scheme”) under which the Company decided to grant, from time to time, options to the employees of the Company and its subsidiaries. The grant of options to the employees under the ESOP Scheme is on the basis of their performance and other eligibility criteria. (ii) On August 31, 2001 and September 28, 2001, the Company issued a total of 1,440,000 equity shares at a price of Rs. 565 per equity share to the Trust. The Company issued bonus shares in the ratio of 10 equity shares for every one equity share held as of September 30, 2001, as a result of which the total number of shares allotted to the trust increased to 15,840,000 equity shares. (iii) Pursuant to the shareholders’ further resolution dated September 6, 2005, the Company announced a new Employee Stock Option Scheme (hereinafter called “the New Scheme”) under which the maximum quantum of options was determined at 9,367,276 options to be granted to employees from time to time on the basis of their performance and other eligibility criteria. (iv) All above options are planned to be settled in equity at the time of exercise and have maximum period of 7 years from the date of respective grants. The plans existing during the year are as follows: a) 2001 Plan under the Old Scheme The options under this plan have an exercise price of Rs. 22.50 per share and vest on a graded basis as follows: Vesting period from the grant date Vesting schedule For options with a vesting On completion of 12 months 20% period of 36 months: On completion of 24 months 30% On completion of 36 months 50% For options with a vesting On completion of 12 months 15% period of 42 months: On completion of 18 months 15% On completion of 30 months 30% On completion of 42 months 40% For options with a vesting On completion of 12 months 10% period of 48 months: On completion of 24 months 20% On completion of 36 months 30% On completion of 48 months 40%

6 Consolidated - Airtel 149-192.p65 186 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 )2005PlanundertheNewScheme e) )2004PlanundertheOldScheme. b) )InfratelOptions g) 2008PlanandAnnualGrant(AGP)undertheNewScheme f) 2006PlanundertheOldScheme d) Super-pot PlanundertheOldScheme c) eido 0mnh:O opeino 4mnh 20% 20% Oncompletion of24months On completionof12months period of60months: For optionswithavesting eido 8mnh:O opeino 4mnh 20% 10% Oncompletionof24months Oncompletionof12months period of48months: For optionswithavesting a gradedbasisfromtheeffectivedateofgrantasfollows: The optionsunderthisplanhaveanexercisepriceintherangeofRs.221toRs922pershareandveston eido 8mnh:O opeino 8mnh 50% Oncompletionof48months period of48months: eido 8mnh:O opeino 4mnh 20% 10% Oncompletionof24months On completionof12months period of48months: For optionswithavesting The optionsunderthisplanhaveanexercisepriceofRs.70pershareandvestonagradedbasisasfollows: eido 8mnh:O opeino 4mnh 20% 15% Oncompletion of24months 33% Oncompletionof12months 33% 35% Oncompletion of24months 25% period of48months: For optionswithavesting Oncompletionof12months effective dateofgrantasfollows: The optionsunderthisplanhaveanexercisepriceofRs.340pershareandvestonagradedbasisfromthe period of36months: For optionswithavesting 50% a gradedbasisfromtheeffectivedateofgrantasfollows: The optionsunderthisplanhaveanexercisepriceintherangeofRs.590to673pershareandveston 30% Oncompletionof36months 30% Oncompletionof24months For optionswithavesting On completionof12months effective dateofgrantasfollows: The optionsunderthisplanhaveanexercisepriceofRs.10pershareandvestonagradedbasisfromthe period of36months: For optionswithavesting The optionsunderthisplanhaveanexercisepriceofRs.Nilpershareandvestonagradedbasisasfollows: 187 Vesting period from the grant date Vesting schedule Vesting Vesting periodfromthegrantdate Vesting period from the grant date Vesting schedule Vesting Vesting periodfromthegrantdate Vesting period from the grant date Vesting schedule Vesting Vesting periodfromthegrantdate schedule Vesting Vesting periodfromthegrantdate schedule Vesting Vesting periodfromthegrantdate Vesting period from the grant date Vesting schedule Vesting Vesting periodfromthegrantdate ncmlto f3 ots40% 40% On completionof36months On completionof48months ncmlto f6 ots20% 20% 20% 35% On completionof60months On completionof48months On completionof36months On completionof48months 33% 40% On completionof36months 40% On completionof48months ncmlto f3 ots30% On completionof36months ncmlto f3 ots30% On completionof36months ncmlto f3 ots30% On completionof36months Vesting periodfrom the grantdate 7/21/2009, 9:23 PM 08Pa AGP 2008 Plan schedule etn Vesting Vesting schedule 187

BHARTI AIRTEL ANNUAL REPORT 2008-09 (v) The information concerning stock options granted, exercised, forfeited and outstanding at the year-end is as follows: (Shares in Thousands) As of March 31, 2009 As of March 31, 2008 Number of Weighted Weighted Number of Weighted Weighted stock options average average stock options average average In (000) exercise price remaining In (000) exercise price remaining contractual contractual (Rs.) life (in Years) (Rs.) life (in Years) 2001 Plan Number of shares under option: Outstanding at beginning of year 37 22.50 – 131 22.50 – Granted –––––– Exercised* 11 22.50 – 44 22.50 – Cancelled or expired 7 – – 50 – – Outstanding at the year end 19 22.50 0.00 to 3.25 37 22.50 0.25 to 4.25 Exercisable at end of year 19 22.50 – 37 22.50 – Weighted average grant date fair value/ exercise price per option for options granted during the year/period at less than market value –––––– 2004 Plan Number of shares under option: Outstanding at beginning of year 478 70.00 – 755 70.00 – Granted –––––– Exercised* 189 70.00 – 207 70.00 – Cancelled or expired – – – 70 – – Outstanding at the year end 289 70.00 1.76 to 2.25 478 70.00 2.76 to 3.25 Exercisable at end of year 289 70.00 – 478 70.00 – Weighted average grant date fair value/ exercise price per option for options granted during the year/period at less than market value –––––– Superpot Plan Number of shares under option: Outstanding at beginning of year 6 – – 25 – – Granted –––––– Exercised* – – – 17 – – Cancelled or expired –––2–– Outstanding at the year end 6 – 2.25 6 – 3.25 Exercisable at end of year 6––6–– Weighted average grant date fair value/ exercise price per value for options granted during the year/period at less than market value –––––– 2006 Plan Number of shares under option: Outstanding at beginning of year 1,393 10.00 – 1,251 10.00 – Granted 130 10.00 – 300 10.00 – Exercised* 18 10.00 – 17 – – Cancelled or expired 300 – – 141 – – Outstanding at the year end 1,205 10.00 5.07 to 5.35 1,393 10.00 5.58 Exercisable at end of year 34 10.00 –––– Weighted average grant date fair value/ exercise price per value for options granted during the year/period at less than market value 130.47 526.50 – 300.47 645.14 – Scheme 2005 Number of shares under option: Outstanding at beginning of year 3,841 474.60 – 3,020 287.66 – Granted – – – 1,863 851.47 – Exercised 239 268.16 – 249 249.51 – Cancelled or expired 603 – – 793 – – Outstanding at the year end 2,999 474.60 3.44 to 5.92 3,841 474.60 4.44 to 6.92 Exercisable at end of year 938 474.60 – 289 474.60 – Weighted average grant date fair value/ exercise price per option for options granted during the year/period at less than market value – – – 1,863 345.79 – Scheme 2008 & Annual Grant Plan Number of shares under option: Outstanding at beginning of period –––––– Granted 3,108 660.72 –––– Exercised –––––– Cancelled or expired 211 ––––– Outstanding at period end 2,897 662.44 –––– Exercisable at end of period –––––– Weighted average grant date fair value/ exercise price per option for options granted during the period at less than market value 3,108 308.87 –––– Infratel Options Number of shares under option: Outstanding at beginning of period –––––– Granted 2,450 340.00 –––– Exercised –––––– Cancelled or expired –––––– Outstanding at period end 2,450 340.00 –––– Exercisable at end of period –––––– Weighted average grant date fair value/ exercise price per option for options granted during the period at less than market value 2,450 374.81 –––– *Options have been exercised out of the shares issued to the trust The weighted average share price during the year was Rs.733.62.

6 Consolidated - Airtel 149-192.p65 188 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65 0 EarningsperShare 20. 1 ForwardContracts&DerivativeInstruments 21. vi Thebalance (vii) usadn uigteya*55071,549,696 10 565,047 10 Weighted AveragenumberofEquitysharesandEquivalent outstanding duringtheyear* Dilutive effectonweightedaveragenumberofequityshares Weighted averagenumberofequityshares Nominal valueofequityshares(Rs.) Particulars negdfrincrec eevbe - - asset wouldhavebeenlower byRs.3,696,041thousand. March 31,2008),andnetfixed assetswouldhavebeenhigherbyRs.16,924,162 thousand anddeferredtax thousand foryearended March 31,2009(lowerbyRs.2,923,206thousand fortheyearended Had theGroupcontinuedwith itsearlierpolicy,netprofitaftertaxwouldhavebeen higherbyRs.13,024,368 fluctuations directlytotheProfit &LossAccount. per policyhithertofollowed, theCompanyhas,witheffectfromApril1,2008, charged/creditedsuch Rules 2006(‘AsAmended’)datedDecember7,2006.Instead ofcapitalising/decapitalisingsuchfluctuation,as Exchange Rates”notifiedintheCompanies(Accounting Standard) Standard (AS-11)“EffectofChangesinForeign advice. Duringtheyear,effectiveApril1,2008,Group hasadoptedthetreatmentprescribedinAccounting assets tillJune30,2008,aspertherequirementofSchedule VIoftheCompaniesAct,1956basedonalegal The Grouphadfollowedtheaccountingpolicytoadjust foreign exchangefluctuationonloans/liabilityforfixed forecasted receivables. * Unhedgedforeigncurrencyreceivables E 1,898,928,654 ForTraderelatedexposures* B 1,898,670,086 ForLoanrelatedexposures* A Particulars Sr No The followingtabledetailsthestatusofGroup’sexposureasonMarch31,2009: foreign exchangefluctuations. exchange contracts,Optioncontractsandinterestrateswapstomanageitsexposures currency exchangeratesandinterestrates.TheGroupusesderivativefinancialinstrumentssuchasforeign The Group’sactivitiesexposeittoavarietyoffinancialrisks,includingtheeffectschangesinforeign Currency ConvertiblebondsandEmployeeStockOptionPlan(ESOP). *Diluted effectonweightedaveragenumberofequitysharesandprofitattributableisaccountForeign for computingDilutedEPS Thefairvalueoftheoptionsgranted wasestimatedonthedateofgrantusingBlack-Scholes/Lattice (vi) negdfrincrec aals3,7,8 12,951,335 25,052,788 30,470,083 34,834,314 Unhedgedforeigncurrency payables D Unhedgedforeigncurrencyborrowing C All derivativesaretakenforhedgingpurposesonlyand traderelatedexposureincludeshedgestakenfor Wtd average share price on the date of grant 616.80 to 832.55 719.95 to 946.90 to 719.95 832.55 to 616.80 shares becamepubliclytraded,whichmaybeshorterthanthetermofoptions. The volatilityoftheoptionsisbasedonhistoricalsharepricesinceGroup’sequity Wtd averagesharepriceonthedateofgrant Rs. 893,527thousand(March31,2008324,500thousand). 2008 Rs.687,353thousand)andtotalemployeecompensationcostrecognisedfortheyearthenendedis )Otos54952,687,125 3,197,778 81,614,067 534,975 5,347,203 87,241,206 13,566,374 47,865,985 16,087,384 20,181,708 58,581,419 12,572,404 Total b) Options a) Forwards Total c) InterestRateSwaps b) Options a) Forwards 0.00% 0.00% 48to66months 48to60months 6.45%to8.25% For 4.45%to9.70% Dividend yield Volatility life Expected Risk freeinterestrates Particulars valuation modelwiththefollowingassumptions 189 of deferredstockcompensationasonMarch31,2009isRs.1,495,823thousand(March outstanding duringthe 62%t 13%40.09%to41.33% 36.23% to41.39% er18815091,897,378,958 1,898,105,039 year 7/21/2009, 9:23 PM ac 1 09March31,2008 March 31,2009 h ereddFortheyearended the yearended Mrh3,20)(March31,2008) (March 31,2009) March 31, 2009 March 31,2008 March March 31,2009 oinlVleNotional Value Notional Value ,8,7 5,884,903 5,882,178 sa Asat As at 189

BHARTI AIRTEL ANNUAL REPORT 2008-09 The Group has accounted for derivatives, which are covered under the Announcement issued by the ICAI, on marked-to-market basis and has recorded reversals of losses for earlier period of Rs. 1,835,399 thousand for the year ended March 31, 2009 (including reversal of losses recognised in earlier periods Rs. 1,230,080 thousand towards embedded derivatives) (March 31, 2008 recorded marked-to-market loss of Rs. 2,044,991 thousand (including loss of Rs. 1,230,080 thousand towards embedded derivatives). 22. During the year ended March 31, 2005 the Company issued USD 115,000,000 Zero Coupon Convertible Bonds due 2009 (the “FCCBs”). The FCCBs are convertible at any time on or after June 12, 2004 (or such earlier date as is notified to the holders of the FCCBs by the Issuer) up to April 12, 2009 by holders into fully paid equity shares with full voting rights with a par value of Rs 10 each of the Issuer (“Shares”) at an initial Conversion Price (as defined in the “Terms and Conditions of the FCCBs”) of Rs. 233.17 per share with a fixed rate of exchange on conversion of Rs. 43.56 = USD 1.00. The Conversion Price is subject to adjustment in certain circumstances. The FCCBs could be redeemed, in whole or in part, at the option of the Issuer at any time on or after May 12, 2007 and prior to April 12, 2009, subject to satisfaction of certain conditions, at their “ Early Redemption Amount” (as defined in the “Terms and Conditions of the FCCBs”) at the date fixed for such redemption if the “Closing Price” (as defined in the “Terms and Conditions of the FCCBs”) of the Shares translated into U.S. dollars at the “prevailing rate” (as defined in the “Terms and Conditions of the FCCBs”) for each of 30 consecutive “Trading Days” (as defined in the “Terms and Conditions of the FCCBs”), the last of which occurs not more than five days prior to the date upon which notice of such redemption is published, is greater than 120 percent of the “Conversion Price” (as defined in the “Terms and Conditions of the FCCBs”) then in effect translated into U.S. dollars at the rate of Rs. 43.56 = USD 1.00. The FCCBs could also be redeemed in whole, and not in part, at any time at the option of the Issuer at their Early Redemption Amount if less than 5 percent in aggregate principal amount of the FCCBs originally issued is outstanding. The FCCBs could also be redeemed in whole, at any time at the option of the Issuer at their Early Redemption Amount in the event of certain changes relating to taxation in India. The Issuer will, at the option of any holder of any FCCBs, repurchase at the Early Redemption Amount such FCCBs at such time as the Shares cease to be listed or admitted to trading on the NSE or upon the occurrence of a “Change of Control” (as defined in the “Terms and Conditions of the FCCBs”) in respect of the Issuer. These FCCBs were listed in the Singapore Exchange Securities Trading Limited (the “SGX-ST”). The Company has during the year ended March 31, 2009, converted FCCBs equivalent to USD 500,000 into 93,408 equity shares of the Company at the option exercised by the bond holders which is as follows: Date of Allotement No. of shares FCCB allotted value (USD) 2-Jun-08 93,408 500,000 Total 93,408 500,000 Before April 12, 2009, the Company has received notices for conversion of the FCCBs, equivalent to USD 350,000 convertible into 65,385 equity shares of the Company. The balance FCCBs equivalent to USD 50,000 will be redeemed in US Dollars at 111.84% of their principal amount after completion of the statutory formalities. 23. The Board of Directors in its meeting held on April 29, 2009 have approved sub-division (share split) of existing equity shares of Rs. 10 each into 2 equity shares of Rs. 5 each, subject to the approval of its shareholders. 24. The Board of Directors recommended a final dividend of Rs. 2.00 per equity share of Rs. 10.00 each (20% of face value) for financial year 2008-09. The payment is subject to the approval of the shareholders in the ensuing Annual General Meeting of the Company. 25. As at March 31, 2009, the accumulated losses of Bharti Airtel Services Limited, Bharti Airtel (USA) Limited, Bharti Airtel (Canada) Limited, Bharti Airtel (Hongkong) Limited, Bharti Infratel Ventures Limited and Bharti Telemedia Limited exceed the net worth of the respective companies. However, in view of the support from Bharti Airtel, the holding Company, the accounts of these companies including Bharti Airtel (Singapore) Private Limited, Bharti Airtel Holdings (Singapore) Pte Limited and Bharti Airtel (UK) Limited, are prepared on a going concern basis. 26. Previous year figures have been regrouped/reclassified where necessary to conform to the current year’s classification.

6 Consolidated - Airtel 149-192.p65 190 7/21/2009, 9:23 PM 6 Consolidated -Airtel149-192.p65

Statement pursuant to exemption received under Section 212 (8) of the Companies Act,1956 relating to subsidiary companies for the year ended March 31, 2009 (Rs ‘000)

S. Name of the Country Capital Reserves Total Total Investments Turnover Profit/(Loss) Provision Profit/(Loss) Proposed No. Subsidiary Company of Assets Liabilities Other than Before for After Dividend Registration Investment Taxation Taxation Taxation in Subsidiary

1 Bharti Hexacom Limited India 2,500,000 12,635,684 24,750,492 9,614,808 - 22,875,651 5,615,728 160,647 5,455,081 -

2 Network191 i2i Limited Mauritius 363,150 354,153 10,301,867 9,584,563 - 1,095,161 585,370 - 585,370 - 3 Bharti Airtel Services Limited India 1,000 (148,171) 2,043,901 2,191,072 45,500 4,925,832 (19,354) 16,703 (36,057) - 4 Bharti Airtel (Singapore) Private Limited Singaore 20,139 (14,236) 3,564,400 3,558,497 - 311,565 12,195 14,734 (2,539) - 5 Bharti Infratel Limited # India 5,651,559 98,854,817 177,998,954 73,492,578 2,871,150 26,154,386 4,374,423 1,411,046 2,963,377 - 6 Bharti Telemedia Limited India 102,000 (2,476,018) 6,852,600 9,226,618 - 73,553 (2,230,055) 6,935 (2,236,990) - 7 Bharti Airtel (UK) Limited United Kingdom 28,126 37,760 175,685 109,799 - 46,299 (17,217) - (17,217) - 8 Bharti Airtel (Canada) Limited Canada 4 (24,961) 6,880 31,838 - 4,043 (21,886) - (21,886) - 9 Bharti Airtel Lanka (Pvt) Limited Srilanka 2,107,172 (1,568,925) 6,230,830 5,692,582 - 94,503 (1,584,773) 25,814 (1,610,587) - 10 Bharti Airtel Holdings (Singapore) Pte Limited @ Singapore 1,106,170 50,182 1,156,507 155 - - 56,021 5,436 50,584 - 11 Bharti Airtel (USA) Limited United States of America - (265,602) 1,456,706 1,722,308 - 905,681 (228,029) - (228,029) - 12 Bharti Infratel Ventures Limited India 500 (659) 110 269 - - (328) - (328) - 13 Bharti Airtel (Hongkong) Limited Hongkong 26,333 (29,079) 149,909 152,656 - 160 (13,812) - (13,812) -

14 Bharti Infratel (Lanka) Private Limited Srilanka ------

@ Including Share Application money 7/21/2009, 9:23 PM 191

BHARTI AIRTEL ANNUAL REPORT 2008-09 18 Circle offices

Andhra Pradesh Kerala Splendid Towers, N.H. Bypass, Opp.Begumpet Police Station, Kundanoor Junction, Begumpet, Maradu P.O, Hyderabad – 500016 Kochi - 682 304 Tel: +91-40-2790 4100 Tel: +91-98950 98950 Fax: +91-98490 11841 Fax: +91-98953 38715 Bihar Madhya Pradesh and Chhatisgarh 7th Floor, 3rd & 4th Floor, Anand Vihar, Metro Tower, Boring Canal Road, Near Vijay Nagar, Patna - 800001, Indore - 452010, Tel: +91-612–2223141 Madhya Pradesh Fax: +91-612-2222375 Tel: +91-731–4031 170 Fax: +91-731-4031 101 Delhi and NCR Unitech World, Cyber Park Mumbai, Maharashtra and Gujarat Tower-A, Sector-39, Interface Bldg No. 7, Gurgaon - 122 001 7th Floor, Off Malad Link Road, Haryana Malad West, Tel: +91-124–4552302 Mumbai - 400053 Fax: +91-124-4552233 Tel: +91-22–4003 1400 Fax: +91-22-4003 1505 270, Udyog Vihar, Phase II, North East States and Assam Gurgaon – 122001 Megaplaza, 4th floor, Haryana G.S. Road, Christian Basti, Tel: +91-124–4246644 Guwahati - 78005, Fax: +91-124-4246504 Assam Tel: +91-361-2341369 Gujarat Fax: +91-361-2341370 Zodiac Square, 2nd floor, S.G. Road, Orissa Opp Gurudwara, 3rd floor, C6/53, Ahmedabad - 380 054 Epari Plaza, Kharvela Nagar, Tel: +91-79–2754 4527 Bhubaneswar - 751 001 Fax: +91-79-4009 0114 Tel: +91-674-2536569 Fax: +91-674-2532801 Haryana, Punjab and Himachal Pradesh C-25, Industrial Area, Tamil Nadu and Chennai Phase-2, SAS Nagar, Oceanic Towers Mohali-160 055 101 Santhome High Road Tel: +91-98151 98151 Santhome, Fax: +91-172-4670015 Chennai 600 028 Tel: +91 98400 98400 Jammu and Kashmir Fax: +91-44-4213 7123 B-2, Third Floor, South Block, Uttar Pradesh Bahu Plaza, Airtel Tower, Jammu – 180 012 12, Rani Laxmi Bai Marg, Hazratgunj, Tel: +91-191–2473751 Lucknow - 226001 Fax: +91-191-2473737 Tel: +91-522-2231073 Fax: +91-522-4009399 Karnataka No. 55, Divyasree Towers, West Bengal Opp Jayadeva Hospital, Infinity Building, Banerghatta Road, 6th floor, Sector V, Bangalore 560 076 Salt Lake, Tel: +91-80–4121 8060 Kolkata - 700 091 Fax: +91-80-4121 8070 Tel: +91-33-2357 5332 Fax: +91-33-40060 0664/5

6 Consolidated - Airtel 149-192.p65 192 7/21/2009, 9:23 PM BHARTI AIRTEL LIMITED Regd. Office: Aravali Crescent, 1, Nelson Mandela Road, Vasant Kunj, Phase – II, New Delhi - 110 007, India.

NOTICE

Notice is hereby given that the fourteenth annual general hereby appointed as a director of the Company, meeting of the members of Bharti Airtel Limited will be liable to retire by rotation.” held on Friday, 21st day of August, 2009 at 03.30 P.M. 10. To consider and, if thought fit, to pass with or at Air Force Auditorium, Subroto Park, New Delhi 110010 without modification(s), the following resolution as to transact the following businesses:- an ordinary resolution: ORDINARY BUSINESS “Resolved that pursuant to the provisions of section 257 and other applicable provisions, if any, of the 1. To receive, consider and adopt the audited Balance Companies Act, 1956, Mr. Craig Edward Ehrlich Sheet of the Company as at March 31, 2009, the be and is hereby appointed as a director of the Profit & Loss Account and the Cash Flow Statement Company, liable to retire by rotation.” for the year ended on that date and the reports of the Board of directors and auditors thereon. By order of the Board Registered Office: For Bharti Airtel Limited 2. To declare dividend on equity shares. Aravali Crescent, 3. To appoint a director in place of Mr. Akhil Kumar 1, Nelson Mandela Road, Vijaya Sampath Gupta, who retires by rotation and being eligible, Vasant Kunj, Phase – II, Group General Counsel & offers himself for re-appointment. New Delhi - 110 070, Company Secretary 4. To appoint a director in place of Mr. Ajay Lal, who India. retires by rotation and being eligible, offers himself Date: April 29, 2009 for re-appointment. NOTES: 5. To appoint a director in place of Mr. Arun Bharat Ram, who retires by rotation and being eligible offers 1. A MEMBER ENTITLED TO ATTEND AND VOTE AT himself for re-appointment. THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE ON A POLL INSTEAD OF 6. To appoint a director in place of Mr. Narayanan HIMSELF/HERSELF AND SUCH PROXY NEED NOT Kumar, who retires by rotation and being eligible, BE A MEMBER OF THE COMPANY. PROXIES, IN offers himself for re-appointment. ORDER TO BE EFFECTIVE, MUST BE RECEIVED 7. To appoint M/s. S.R. Batliboi & Associates, Chartered AT THE REGISTERED OFFICE OF THE COMPANY, Accountants, Gurgaon, as the statutory auditors of NOT LESS THAN FORTY-EIGHT HOURS BEFORE the Company to hold office from the conclusion of THE COMMENCEMENT OF THE MEETING. A this annual general meeting until the conclusion of PROXY FORM IS APPENDED WITH THE the next annual general meeting and to authorize ADMISSION SLIP. the Board/Audit Committee to fix their remuneration. 2. The notice of the annual general meeting will be SPECIAL BUSINESS sent to those members whose names appear on the register of members as on Tuesday, June 30, 8. To consider and, if thought fit, to pass with or 2009. without modification(s), the following resolution as an ordinary resolution: 3. Annual Report is available at the website of the Company at www.airtel.in in the Investor Relations “Resolved that pursuant to the provisions of section section. 257 and other applicable provisions, if any, of the Companies Act, 1956, Mr. Quah Kung Yang be and 4. The Register of Members and Share Transfer books is hereby appointed as a director of the Company, of the Company will remain closed from Friday, liable to retire by rotation.” July 31, 2009, to Friday, August 21, 2009 (both days inclusive), in terms of the provisions of the 9. To consider and, if thought fit, to pass with or Companies Act, 1956 and the listing agreement without modification(s), the following resolution as with the stock exchanges where the shares of the an ordinary resolution: Company are listed for the purpose of annual general “Resolved that pursuant to the provisions of section meeting & determining the names of the members 257 and other applicable provisions, if any, of the eligible for dividend on equity shares, if declared at Companies Act, 1956, Mr. Nikesh Arora be and is the meeting.

Notice.p65 1 7/22/2009, 8:25 PM 5. The dividend, if declared at the meeting, will be 9. Corporate members are requested to send a duly paid on or before the 30th day from the date of certified copy of the board resolution/power of declaration of dividend i.e. September 20, 2009, attorney authorising their representative to attend to those members, whose names will appear in the and vote at the annual general meeting. Register of Members on the close of the day on 10. Statutory Registers and documents referred to in July 30, 2009; in case, the shares are held in dematerialized form, to those beneficiaries, whose the accompanying notice and explanatory names are furnished by the National Securities statement, including certificate from the Auditors Depository Limited (NSDL) and Central Depository of the Company under clause 14 of the SEBI Services (India) Limited (CDSL) as beneficial owner (Employees Stock Option Scheme and Employees on that date. Stock Purchase Scheme) Guidelines, 1999, are open for inspection at the Registered Office of the 6. Members, who hold shares in the physical form Company on all working days (Monday to Friday) and desirous of availing ECS facility for direct credit between 11.00 a.m. and 1.00 p.m. upto the date of dividend to their bank account, may submit their of annual general meeting and will also be available requisite request in the enclosed form to the for inspection at the meeting. Company’s Registrars and Share Transfer Agents, Karvy Computershare Private Limited, at Plot No. 11. Members having any questions on accounts are 17-24, Vittal Rao Nagar, Madhapur, Hyderabad 500 requested to send their queries at least ten days in 081, Andhra Pradesh (the Registrar). The ECS advance to the Company at its registered office mandate, in order to be effective, should be address to enable the Company to collect the submitted to the Registrar on or before July 30, relevant information. 2009 so as to receive the dividend, if declared 12. Members/proxies are requested to bring duly filled through ECS. admission/attendance slips sent herewith along with In respect of shareholders holding shares in the copies of annual reports at the meeting. electronic form, the bank details as furnished by 13. For the security and safety of the shareholders, no the respective depositories to the Company will be article/baggage including water bottles and tiffin used for the purpose of distribution of dividend boxes will be allowed at the venue of the meeting. through ECS. The Company/the Registrars will not act on any direct request from members holding The members / attendees are strictly requested not shares in dematerialized form for change/deletion to bring any article / baggage, etc. at the venue of of such bank details. the meeting.

7. Members who are holding shares in physical form MEMBERS MAY PLEASE NOTE THAT NO GIFTS/ GIFT are requested to address all correspondence COUPONS SHALL BE DISTRIBUTED AT THE VENUE concerning, registration of transfers, transmissions, OF THE MEETING. sub-division, consolidation of shares or any other share related matters and/or change in address, or EXPLANATORY STATEMENT updation thereof to Company’s Registrars & Share Transfer Agents, Karvy Computershare Private (Pursuant to the provisions of section 173(2) of the Limited, at Plot No. 17-24, Vittal Rao Nagar, Companies Act, 1956) Madhapur, Hyderabad 500 081, Andhra Pradesh. ITEM No. 8 Members whose shareholding is in the electronic mode are requested to direct change of address Mr. Quah Kung Yang was appointed as an additional notifications and updations of bank account details director on the Board of the Company w.e.f. August 01, to their respective depository participants. Any 2008. Pursuant to the provisions of section 260 of the query related to dividend should be directed to the Companies Act, 1956 read with Article 123(i) of the Registrars and Share Transfer Agents of the Articles of Association of the Company, Mr. Quah Kung Company. Yang holds office upto the date of this fourteenth annual general meeting. The Company has received notice under 8. Information regarding particulars of the directors section 257 of the Companies Act, 1956 from a member to be appointed and the directors seeking re- appointment requiring disclosure in terms of the proposing the candidature of Mr. Quah Kung Yang as listing agreement and the explanatory statement director of the Company, liable to retire by rotation along pursuant to Section 173 of the Companies Act, with the prescribed deposit of Rs. 500/-. 1956, are annexed hereto. The committee None of the directors except Mr. Quah Kung Yang is chairmanships/memberships considered for the concerned or interested in the resolution. purposes of disclosure are those prescribed under clause 49(I)(C) of the Listing Agreement(s) viz. Audit The Board recommends appointment of Mr. Quah Kung Committee and Shareholders’/Investors Grievance Yang as director liable to retire by rotation as set out in Committee of Indian public limited companies. item no. 8.

Notice.p65 2 7/22/2009, 8:25 PM ITEM No. 9 Companies Act, 1956 read with Article 123(i) of the Articles of Association of the Company, Mr. Craig Ehrlich Mr. Nikesh Arora was appointed as an additional director holds office upto the date of this fourteenth annual on the Board of the Company w.e.f. October 30, 2008. general meeting. The Company has received notice Pursuant to the provisions of section 260 of the under section 257 of the Companies Act, 1956 from a Companies Act, 1956 read with Article 123(i) of the member proposing the candidature of Mr. Craig Ehrlich Articles of Association of the Company, Mr. Nikesh as director of the Company, liable to retire by rotation Arora holds office upto the date of this fourteenth annual along with the prescribed deposit of Rs.500/-. general meeting. The Company has received notice under Section 257 of the Companies Act, 1956 from a None of the directors except Mr. Craig Ehrlich is member proposing the candidature of Mr. Nikesh Arora concerned or interested in the resolution. as director of the Company, liable to retire by rotation The Board recommends appointment of Mr. Craig Ehrlich along with the prescribed deposit of Rs. 500/-. as director liable to retire by rotation as set out in item None of the directors except Mr. Nikesh Arora is no. 10. concerned or interested in the resolution. The Board recommends appointment of Mr. NIkesh Arora By order of the Board as director liable to retire by rotation as set out in item Registered Office: For Bharti Airtel Limited no. 9. Aravali Crescent, 1, Nelson Mandela Road, Vijaya Sampath ITEM No. 10 Vasant Kunj, Phase – II, Group General Counsel & Mr. Craig Edward Ehrlich was appointed as an additional New Delhi - 110 070, Company Secretary director on the Board of the Company w.e.f. April 29, India. 2009. Pursuant to the provisions of section 260 of the Date: April 29, 2009

Information on directors seeking appointment/re-appointment at the forthcoming Annual General Meeting (pursuant to clause 49 of the Listing Agreement).

Mr. Akhil Kumar Gupta Director Identification Number 00028728

Date of birth 22nd December, 1955 Qualifications Chartered Accountant. Advanced Management Program at Harvard Business School, USA Experience and expertise in Financial Management specific functional area Shareholding in Bharti Airtel Limited 1,091,692 shares Directorships held in other Indian Bharti AXA General Insurance Company Limited public limited companies Bharti AXA Life Insurance Company Limited Bharti Infratel Limited Bharti Infratel Ventures Limited Bharti Retail (Holdings) Private Limited* Bharti Telecom Limited Bharti Teletech Limited Bharti Wal-Mart Private Limited* Comviva Technologies Limited Indus Towers Limited Mehrauli Realty Consultants Limited Membership/Chairmanship of committees Bharti Airtel Limited - Investor Grievance Committee (Chairman) in public limited companies in India Bharti Infratel Limited - Audit Committee (Member) Bharti Telecom Limited - Audit Committee (Member) Bharti Telecom Limited - Share Transfer Committee (Member) Bharti Teletech Limited - Audit Committee (Chairman) Bharti Wal-Mart Private Limited* – Audit Committee (Member) Indus Towers Limited – Audit Committee (Chairman) * Public limited company in terms of section 3(1) (iv)(c) of the Companies Act, 1956 3

Notice.p65 3 7/22/2009, 8:25 PM Mr. Ajay Lal Director Identification Number 00030388 Date of birth 8th August, 1961 Qualifications Engineering from IIT New Delhi MBA from IIM Kolkata Advanced Management Program Graduate from Harvard Business School. Experience and expertise in specific Management, Private Equity, Project Finance and Corporate Banking functional area Shareholding in Bharti Airtel Limited 10,000 shares Directorships held in other public limited The Catholic Syrian Bank Limited companies in India Membership/Chairmanship of committees Bharti Airtel Limited - Audit Committee (Member) in public limited companies in India The Catholic Syrian Bank Limited - Audit Committee (Member)

Mr. Arun Bharat Ram Director Identification Number 00694766 Date of birth 15th November, 1940 Qualifications Engineering from the YMCA Institute of Engineering Experience and expertise in specific Management functional area Shareholding in Bharti Airtel Limited Nil Directorships held in other public limited DCM Shriram Consolidated Limited companies in India JK Paper Ltd Moser Baer (India) Limited Samtel Color Limited Samtel Glass Limited SRF Energy Limited SRF Fluorochemicals Ltd SRF Infrastructuire Limited SRF Limited SRF Polymers Investment Limited Membership / Chairmanship of committees Bharti Airtel Limited - Audit Committee (Member) in public limited companies in India DCM Shriram Consolidated Limited – Audit Committee (Member) J K Paper Limited - Shareholders’/Investors Grievance Committee (Member) SRF Limited - Shareholders’/Investors Grievance Committee (Member)

Mr. Narayanan Kumar Director Identification Number 00007848 Date of birth 28th January, 1950 Qualifications Engineering in Electronics and Communications from Anna University, Chennai Experience and expertise in specific Technology, Management and Finance functional area Shareholding in Bharti Airtel Limited Nil Directorships held in other Indian Bharti Infratel Limited public limited companies Cochin Shipyard Limited Entertainment Network (India) Limited MRF Limited Take Solutions Limited Times Innovative Media Limited Membership/Chairmanship of committees Bharti Airtel Limited – Audit Committee (Chairman) in public limited companies in India Bharti Infratel Limited – Audit Committee (Chairman) Cochin Shipyard Limited – Audit Committee (Chairman) Entertainment Network (India) Limited - Audit Committee (Chairman) Take Solutions Limited – Shareholder/Investor Grievance Committee (Chairman) Times Innovative Media Limited - Audit Committee (Member)

Notice.p65 4 7/22/2009, 8:25 PM Mr. Quah Kung Yang Director Identification Number 02274965 Date of birth 14th November, 1961 Qualifications Fellow of the Institute of Chartered Accountants in England and Wales Member of the Institute of Certified Public Accountants of Singapore Graduate of the University of Kent at Canterbury, England. Experience and expertise in specific Financial Management functional area Shareholding in Bharti Airtel Limited Nil Directorships held in other public limited Bharti Telecom Limited companies in India Membership/Chairmanship of committees Bharti Airtel Limited - Audit Committee (Member) in public limited companies in India Bharti Telecom Limited – Audit Committee (Member)

Mr. Nikesh Arora Director Identification Number 02433389 Date of birth 9th February, 1968 Qualifications MS in Finance from Boston College MBA from the Northeastern University in the United States. Experience and expertise in specific Finance and Business Administration functional area Shareholding in Bharti Airtel Limited Nil Directorships held in other public limited Nil companies in India Membership/Chairmanship of committees in Nil public limited companies in India

Mr. Craig Edward Ehrlich Director Identification Number 02612082 Date of birth 14th May, 1955 Qualifications Graduate from University of California Los Angeles Masters degree from Occidental College Postgraduate Fellowship from Coro foundation Experience and expertise in specific Finance and Business Administration functional area Shareholding in Bharti Airtel Limited Nil Directorships held in other public limited Nil companies in India Membership/Chairmanship of committees Nil in public limited companies in India

By order of the Board For Bharti Airtel Limited Registered Office: Aravali Crescent, 1, Nelson Mandela Road, Vasant Kunj, Phase – II, Vijaya Sampath New Delhi - 110 070, India. Group General Counsel & Date: April 29, 2009 Company Secretary

Notice.p65 5 7/22/2009, 8:25 PM Notice.p65 6 7/22/2009, 8:25 PM ECS MANDATE FORM [APPLICABLE FOR SHARES HELD IN PHYSICAL FORM ONLY]

Karvy Computershare Private Limited Unit: Bharti Airtel Limited Plot No. 17-24, Vittal Rao Nagar, Madhapur, Hyderabad. Pin: 500 081

Name of the First/Sole Share holder

Folio No.

PAN / Email information

Income Tax Permanent Account Number (PAN) (Please attach a photocopy of PAN Card)

Email ID

ECS Mandate Form (for shares held in Physical mode)

Bank Name

Branch Name & Address

Bank Account Type (tick) SB Current Others Bank Account Number 9 Digit Code Number of the Bank and Branch appearing on the MICR Cheque issued by the Bank (Please attach a photo copy of the Cheque)

I hereby declare that the particulars given above are correct and complete and also express my concurrence to receive information through e-mail towards dividend paid by the Company under the ECS mode.

______Signature of the 1st Registered Holder/Sole Holder

Notice.p65 7 7/22/2009, 8:25 PM Notice.p65 8 7/22/2009, 8:25 PM Notice.p65 I/we herebyrecordmy/ourpresenceatthefourteenthannualgeneralmeetingofCompanybeingheldon21 ...... Name(s) andaddressoftheshareholderinfull be heldon21 my/our proxytoattendandvoteforme/usonbehalfatthefourteenthannualgeneralmeetingofCompanyscheduled to ...... orfailinghim...... of...... inthedistrictof...... I/we beingamemberofBhartiAirtelLimited,herebyappoint...... Name(s) andaddressoftheshareholderinfull Apial o netrhligsae npyia om Signed by the said TheProxyformdulycompletedandsignedshouldbedeposited attheRegisteredOfficeofCompanysituated Note : *Applicable forinvestorholding sharesinphysicalform. Dated: ______I/we directmy/ourproxytovoteontheresolutionsinmannerasindicatedbelow: adjournment thereof. — *Applicable forinvestorsholdingsharesinphysicalform. Please ( 2009 at3.30p.m.AirForceAuditorium,SubrotoPark,NewDelhi–110010 Appointment ofMr.CraigEdwardEhrlichasadirectorliableto retirebyrotation Appointment ofMr.NikeshAroraasadirectorliabletoretireby rotation Appointment ofMr.QuahKungYangasadirectorliabletoretire byrotation Accountants, Gurgaon,asthestatutoryauditors Reappointment ofM/s.S.R.Batliboi&Associates,Chartered Re-appointment ofMr.NarayananKumar Re-appointment ofMr.ArunBharatRam Re-appointment ofMr.AjayLal Re-appointment ofMr.AkhilKumarGupta Declaration ofDividend Adoption ofAnnualFinancialStatementsandReports Resolutions Regd. FolioNo.* DP Id Regd. FolioNo.* DP Id MEMBER Regd. Office:AravaliCrescent,1,NelsonMandelaRoad,VasantKunj,Phase–II,NewDelhi110070 Regd. Office:AravaliCrescent,1,NelsonMandelaRoad,VasantKunj,Phase–II,NewDelhi110070 commencement oftheAnnualGeneralMeeting. Aravali Crescent,1,NelsonMandela Road,VasantKunj,Phase–II,NewDelhi-110070notlater than48hoursbeforethe ) inthebox st of day of August, 2009at03.30P.M.AirForceAuditorium,SubrotoPark,NewDelhi–110010or/andany ofdayAugust, 7

PROXY ...... BHARTI AIRTELLIMITED BHARTI AIRTELLIMITED ...... 7/21/2009, 9:23 PM Signature ofMember/Proxy ______No. ofShares Client Id No. ofShares Client Id ...... as o Against For

...... ADMISSION SLIP PROXY FORM st dayofAugust, Stamp of Affix the Revenue Re. 1/-

7 BHARTI AIRTEL ANNUAL REPORT 2008-09 Notice.p65 8 7/21/2009, 9:23 PM Printed at Thomson Press