BPL to invest Rs 500 cr on GSM

NEW DELHI: Indian cellular service provider in the GSM space, BPL group, will invest roughly Rs 500 crore on expanding its network to meet growing demand, a top company official said.

The company, which also has interests in consumer durables, offers cellular services to 1.4 million users in four of 22 circles into which the booming Indian telecom sector is divided. Each circle is roughly equal to a state or a large city.

"The market (for cellular services) is nearly doubling each year and we hope to maintain that rate in our user base," Fausto B. Cardoso, president of BPL Mobile, told reporters on the sidelines of an industry conference.

"We will invest upwards of five billion rupees ($110.3 million) in all four circles combined over the next one year to expand capacity and coverage to meet this demand."

Cardoso said BPL would invest the funds in buying new GSM equipment from Finland's Nokia, U.S.-based Motorola Inc and German communications giant Siemens AG.

Unlisted BPL Mobile is among more than a dozen telecoms firms fighting for a slice of India's growing mobile base expected to cross 100 million by 2008 from about 19 million.

The nine-year-old sector has some of the world's lowest tariffs that are luring more users in an underpenetrated market.

Only about two percent of India's billion plus people have cellular phones -- compared with 19 percent in China and more than 60 percent in Europe.

Cellular firms also compete with basic operators who provide cheaper limited mobility services based on CDMA technology.

Reuters