South Asian and Middle Eastern telecoms sector has shown resilience not only in the revenue generated by operators but also in their spending capacity. According to a recent study of Frost & Sullivan, the sector will see investments in developing markets like India, Sri Lanka, and Bangladesh as well as in mature markets like the U.A.E and Saudi Arabia.
India, with its sheer size, will continue to dominate the spending in South Asia. It spent US$21.56 billion in 2008, which is anticipated to grow at a CAGR of 2.2 percent till 2015 to reach $25.13 billion. The CAPEX will be driven by 3G operations that are expected to start in the next couple of years and the thrust on broadband and carrier services by incumbent larger operators.
The total telecom spending in the Bangladesh was $1.8 billion in 2008. It is expected to grow at a CAGR of around 2.4 percent between 2008 and 2015 to reach $2.06 billion. The growth in spending will be led by the foray into the untapped rural market. But Bangladesh is plagued with taxation issues and the introduction of SIM tax has adversely affected growth in telecoms sector, the study said.
The high competition amongst the Sri Lankan carriers in a relatively small market of 20 million people has impacted investments in the country. The spending was led by two big operators while other operators struggle to survive. Frost & Sullivan estimates that the total telecom spending in the Sri Lankan market was around $589.4 million in 2008; this is expected to grow at a CAGR of around 0.08 percent between 2008 and 2015 to reach $592.68 million. The end of the civil war has opened up the northern and eastern parts of the country thereby driving the country’s CAPEX levels.
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“It is expected to grow at a CAGR of around 2.4 percent between 2008 and 2015 to reach $2.06 billion”
CAGR of around 2.4 percent ??? They must be out of their mind. GDP growth will be around 6% during this period, no way telecom investment is lower than the countries’ GDP growth, as it has been the case for a while. Something not right about Caroline Lewis / Tanu Chopra.