Pakistan's Telecom Boom Continues

Telecom sector is attracting the largest share of foreign direct investment in Pakistan. Foreign investors pumped in $364m into it during July-Sept 2007 quarter, according to the latest figures released by Pakistan Telecommunications Authority. The total FDI in Pakistan for this 3-month period was $962.5m.
The number of cellular subscribers in Pakistan has crossed 76m in Dec, 2007, from 500,000 in 2004. According to Business Recorder, Pakistan's financial daily, most forecasters believe that the upward trend will continue in the next 5 years because of the huge market potential, particularly in the rural areas where the build-out has yet to happen. Opreators such as Wateen (with Motorola) are planning a large Wimax roll-out to improve voice and high bandwidth data access across the country. The biggest mobile operators in Pakistan include Mobilink with 30m subscribers, Ufone with 16m, Telenor with 14m, Warid with 13m and Paktel with 1m.
It must be noted that FDI is different from stock market investments. FDI money goes to build factories, infrastructure and facilities rather than the purchase of financial assets such as stocks and bonds by mutual funds.
According to Pakistan's Daily Times, Pakistan’ telecom boom has created more than 300,000 jobs in the telecom sector. This has resulted in huge demand for professional and capable telecom workforce that can expertly meet the new age requirements of these positions. Creative public private partnerships are being established to meet this demand.

Thanks to Pakistanis' rising incomes, which have more than doubled to over US$900 per year in the last seven years, and increased competition, the teledensity rate is expected to go over 50 percent in the next couple of years, according to officials and analysts. Opportunities such as these are fueling the continuing growth in the middle class which further enhances the ongoing consumer boom. By various estimates, the Pakistani middle class has now grown to over 30m people, about 20% of the total population. The size of this middle class makes Pakistan an attractive opportunity for investors, in spite of the continuing political uncertainty with the approaching elections in February, 2008. Analysts such as Merrill Lynch's Chief Market strategist Mark Matthews are very bullish on Pakistan. Matthews has called Pakistan a "safe haven" for investors as recently as Jan 6, 2008 in an interview with CNBC.


Riaz Haq said…
Here's an ET story about Pakistan teledensity near 76%:

The country’s total mobile phone subscriptions reached an all-time high of 137.68 million at the end of April 2014, corresponding to a cellular mobile teledensity of 75.6% for the first time, according to the latest data released by the Pakistan Telecommunication Authority (PTA).
The PTA statistics revealed that each of the given cellular mobile operators (CMOs) were able to increase their subscriber base – collectively selling 1.2 million new connections in April 2014.
Telenor Pakistan and China Mobile (Zong) were once again the highest contributors to the growth of country’s mobile phone subscribers.
Telenor Pakistan sold 665,591 new connections during the month under review, taking its overall subscriber base to 35.87 million. The Pakistani arm of the Oslo-based cellular giant holds 26% share in the country’s cellular subscriber base, only two percentage points behind market leader Mobilink.
Mobilink maintained the top place, growing its subscriptions to 38.3 million after adding 145,941 new subscriptions to its network. Its share in the cellular segment is 28% as of April, 2014, the data revealed.
Zong, the Pakistani subsidiary of China Mobile, also continued its positive growth by selling 387,527 new connections in April and finished at number three with 25.98 million subscriptions. It now accounts for 19% of the country’s telecom subscriptions – just one percentage point above Ufone that slipped to number four with a market share of 18% or 24.6 million subscribers at the end of April, 2014. It sold only 2,435 new connections during the review period.
Warid Telecom, the smallest player in terms of subscriber base, sold 11,831 new connections and finished with a market share of 9% or 12.95 million subscriptions, according to the latest statistics.

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