Telecom Co’s invests $8 bn in mobile sector

Islsmabad: Telecom companies have invested over $8 billion during the last four years particularly in the mobile sector whose investment share accounts for 73 percent. The cellular mobile sector has invested over $2.7 billion, which becomes a major share of investment by the sector.

Local loop segment of the industry is also taking off and in 2006-07 about $7.8 million was invested by this sector while LDI operators invested about $603 million during this period that is about 15 percent of the total investment by the sector.

It is expected that the trend of investment may continue in the next five years because large potential market still exists in Pakistan and all operators intend to grab their share. The China Mobile acquired Paktel, which has contracted out $500 million project to renowned companies like Ericcson, ZTE, and Alcatel to roll out their networks.

Similarly, the Mobilink also planned to invest $500 million in 2007-08 for improvement in quality of service and infrastructure expansion. The Wateen Telecom, which has already laid down 5,400-km of optical fiber across the country has announced to invest $600 million in next two years for improvement in its infrastructure.

The telecom sector has emerged as the largest recipient of Foreign Direct Investment (FDI) in Pakistan during the last few years as competition has compelled many companies to expand their infrastructure, which requires more investment from foreign sources.

The telecom sector has attracted record inflows of FDI in the last two years and emerged as the only sector of economy that attracted such huge investment, where its share in total FDI crossed 54 percent.