3G Auction Can Attract $ 1 Billion: Governor SBP

3G in PakistanThe auction of 3G licenses in Pakistan can attract more than one billion dollar as against a minimum target of $850 million, resulting positive impacts on economy mainly to contain a widening fiscal deficit of the country, said Yaseen Anwar Governor State Bank of Pakistan.

Addressing a press conference for the announcement of monetary policy, he appreciated the government efforts for auction of 3G licenses in the telecommunication sector as a positive development could help in containing the potential fiscal slippage.

He said the government’s projected privatization proceeds of $800 million of Pakistan Telecommunication Limited (PTCL) will add handsome financial inflows to the state kitty along with different sources such as issuance of $500 million “euro bonds” and $800 million from Coalition Support Funds.

The telecom sector has been in the limelight again as the sole sector that can prevent the country from economy crisis with inflows of handsome FDI through auction of 3G licenses with host of economic activities.

PTA earlier this month announced the base price of 3G licenses at $ 210 million, with maximum of three 3G/4G licenses to be auctioned in addition to one defunct cellular licenses with base price of $ 150 million.

Analysts predict the maximum value Government can attain for 3G auction wouldn’t go beyond $ 230-250 million if government fails to attract any foreign investor (operator) in the bidding. However, 3G licenses’ price can go significantly high if 2-3 foreign operators get interested in operating in Pakistan.

This increased the government’s involvement in the bidding process, which will be supervised by Ministry of Finance and Ministry of Information Technology and Telecommunication (MoITT).

The telecom sector has been major source of Foreign Direct Investment (FDI) in the past. In 2005-06, the telecom sector brought US $ 1.905 billion in the country with 54 percent share in the overall FDI, SBP figures showed.

The FDI in the telecom sector continued to fall as it share reached to merely 5 percent in the outgoing fiscal 2010-11.

With the arrival of 3G/4G technology, it is estimated that billion dollar investment will be landing in the private sector with creation of thousands of jobs and allied businesses.

  • usama khalid

    $ 1 Billion Dollar!!!!! $ and DOLLAR, both! Aamir bhai, pls ask your team to be professional now.

  • Xahid

    such as issuance of “$500 million euro” bonds [/quote]
    $ or euro ? or both? lol

    • Fahad

      “Euro Bonds” for Pakistan are those bonds which are being issued outside Pakistan.
      Please also check the difference between “Euro” and the “The Euro”.

  • Shahid Saleem

    What if they hold the auction and no one bids?

    • usama khalid

      PTA will simply be screwed….. Very simple!

      • usama khalid

        And they deserve it!

  • aasif

    faraud faraud faraud
    ya pakistanioon ko lootny ka new tariqa dhonda hy ab pahly light nai hy na gas ab ya drama aa raha hy

  • sadeeq

    i am student of telecom engineering.Now listening news about 3G i am thinking how much it will help me in getting job!

  • Tony

    What if some Arab company wins the bid and later does not honor the terms of bid? History will repeat itself and our bureaucrats instead of confiscating the bid money will give lucrative terms to the Arab company and Arab company will give kickbacks to bureaucrats and politicians. Look how India is controlling corruption in her telecom sector.

  • KHAN

    Oh come on Mr. Yaseen , please be realistic. The telecom market in Pakistan is already in maturity stage and the price competition has already reduced the ARPU that the cellular companies are getting.

    Even if we can get a price $ 291 Million, which was the price for 2 G auction that will be great. I will also like PTA to be more realistic and tell the real facts as there investors conference on 3 G held in January was a major failure to attract any big investor.

    Lastly the auction date of 3 G , which is 28th March is also going to be delayed soon …..

  • bonga maharaj

    Biknay kau tau meri shirt bhee 2 USD billion ke bik sakti hay….the statement only reflect the incompetence of our institutional heads

  • then what are they waiting for?