UAE-based Emirates Telecommunications Corporation (Etisalat) on Wednesday said it was not involved in the 2G scam and offered to cooperate fully with the Indian authorities if approached.

The vice-chairman of Etisalat DB, a joint venture between Etisalat and India''s DB Group, was arrested over allegations that two Indian firms got favorable treatment when 2G spectrum licences were awarded in 2008.

Etisalat, which owns an approximately 45 per cent stake in the venture, has maintained that it bought the stake in the firm, then called Swan Telecom, after the licence had been applied for and granted.

"Etisalat had no involvement whatsoever in the Unified Access Services (UAS) licence application process," it said in a statement.

"It is a subsequent external investor ...  which purchased its stake in the company on the bona fide belief that the licences have been validly granted," the telecom giant added.

The Abu Dhabi-based firm also said it was committed to India and would not withdraw from the country, the world's fastest growing mobile market.

Etisalat said that it acquired stake in Etisalat DB (formerly Swan Telecom Pvt Ltd), in December 2008, which means the companys investment in Etisalat DB took place entirely after the Unified Access Services (UAS) licences had been applied for and obtained by Swan Telecom.

"Etisalat always operates within the laws of the countries in which it operates and will cooperate fully with the Indian authorities if approached," it added.

India's investigating agency CBI yesterday arrested the promoter of Swan Telecom, Shahid Usman Balwa, in connection with 2G spectrum allocation scam.

Swan Telecom had won licences for 13 circles, including Mumbai and Delhi, for Rs. 1,537 crore in 2008 but it sold 45 per cent shares to Etisalat for approximately Rs. 4,500 crore within months of bagging the spectrum.