Recently I had occasion to look for up-to-date mobile subscriber figures for several countries including India and Pakistan. I've separately looked at and written about their telecom markets before, e.g. here & here, leveraging information from public sources and advice and comments from Indian and Pakistani friends. But I had never put to two side-by-side.
India should pay attention. Pakistan has figured out a winning formula.
Population data from the CIA World Factbook.
Pakistan’s mobile market lagged India’s through 2004, but here are recent (14–18 months) numbers and calculated growth rates based on data from RCR Wireless (2004) and the respective regulators (Telecom Regulatory Authority of India [for Feb06] and Pakistan Telecommunications Authority [for Jan06]).
So what’s up?
As I commented about Pakistan’s mobile market back in December,
…real changes happened in 2004. First, in April the government granted two more licenses < thus six competitors>. Telenor won one of those licenses, built a network and launched services in February 2005. Warid won the other, launching services in April 2005. Second, in June 2004 the government abolished the remaining restrictions on foreign direct investment permitting foreign investors to retain 100% equity in their investments. And third, they dropped the activation tax to Rs. 500 (~ $ 8) <from Rs. 5000 in 2001>.
I’m an outsider, an American with neither Indian nor Pakistani ancestors, but I want to see everyone on the planet with a mobile phone — as soon as possible. This can only happen if developing countries stop inhibiting telecommunication growth. The formula is pretty clear:
- Foster real competition – more than four competitors everywhere in the country.
- Foster foreign investment — eliminate all restrictions on foreign direct investment in telecom.
- Reduce taxes — eliminate all telecom-specific taxes.
Pakistan made big advances on all three points in 2004, and look at the results. India please take note.