NEW DELHI, INDIA: U.S. phone company AT&T is in talks to buy a stake in Indian state-owned telecoms firm Bharat Sanchar Nigam Ltd, the Economic Times said on Monday, citing unnamed sources with knowledge of the development.

Unlisted BSNL has sought government permission to launch an initial public offering of 10 percent and the newspaper said a pre-IPO placement might be a possibility.

It said officials from AT&T and BSNL recently met twice in New Delhi to discuss the matter.

The paper said AT&T declined to comment, while BSNL Chairman Kuldeep Goyal denied the development.

"BSNL is not even listed and any such move will require a lot of regulatory approvals," Goyal told the paper.

Goyal did not immediately answer a phone call by Reuters.

AT&T had applied in 2007 to get a telecoms licence in India, but is still waiting. The telecoms regulator earlier this month asked the government not to issue new licences until it decides whether there was a need for more players in the crowded market.