GB Commission report makes further GP investment 'uncertain'

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Sigve Brekke

Mohammad Ali The Grameenphone (GP) authority has said that the Grameen Bank Commission's report on (GP) has thrown further investment of the country's largest telecom operator into uncertainty. Talking to reporters at a city hotel Sunday, Chairman of GP Sigve Brekke said his company may not be able to take part in the ensuing 3G auction unless 'uncertainties' are removed forthwith. There is a need to have clearer regulatory and investment framework for a lot of investment and continuation of an industry's development in the country, he said. Cell-phone companies earlier also urged the government to immediately solve some issues including value added tax and 2G licence renewal. In addition to those, GP now terms this report a major uncertainty for its investment in the sector. The government-sponsored Grameen Bank Commission in its interim report, recently submitted to the finance ministry, recommended immediate suspension of the GP licence as the operator was not a party to the 1996 licence agreement. The report also recommended that dividends going from GP to Grameen Telecom, which has 34.2 per cent in the operator, should go to Grameen Bank (GB) as the bank owns all of the 54 organisations including Grameen Telecom. Mr Brekke said, "I cannot understand why we are part of this, because there is no link of Grameenphone and Grameen Bank. We have a shareholder named Grameen Telecom and that is different from Grameen Bank. These are two different entities." About the Commission's findings in respect of licence giving process, he said, "Our papers and documentations show something else." When his comment was sought on the commission's recommendation about GP dividends, Mr Brekke said, "I cannot comment on it because only thing I know is that Grameen Telecom is an owner of Grameenphone. Grameen Telecom has representatives in the board. I have no idea on who is the shareholder of Grameen Telecom and what that arrangement is." Expressing his willingness to discuss with the government on the issue to find a solution, the GP chairman expressed the hope that the government will listen to the company's concerns and will clarify the issues. There are so many unclear issues including the value added tax, 2G licence renewal and the whole industry in the 3G process, he said, and stressed the need for sorting out the issues before participation in the 3G auction. Mentioning two issues in the report, he said one of the commission's mandate was to look into the Grameen Bank; then why the Grameenphone. Referring to the report's annexure, he said we cannot understand whether the report is based on facts or not with regard to giving GP licence. "So, we are willing to discuss with the government on these issues, but that need to be based on the fact, not assumptions," he added. Replying to a query, he said the commission has already written a letter to the telecom department asking it to take actions in this connection. So, I cannot discuss with the commission, rather may do so with the government representatives, he said. When asked whether GP will go for legal action, he said that firstly it's an interim report, not final report. After the final report, we need to look at what the government will do on it. Of course, we will take step to protect our investment. I expect a positive dialogue with the government to sort out the issues. If the uncertainties continue, we might be forced not to participate in the 3G auction, the GP chairman added. Talking about the company's next plan, he said, we have a big plan to provide new services including M2M (machine-to-machine) technology, NFC (near field communications), mobile banking and health services in Bangladesh. All these services need data connectivity. That's why 3G licence is very important as it needs powerful speed of network and all the investors are interested in getting licence of 3G, he said. "We see a bright future in the Bangladesh telecom sector, we want to be a part of the country's digital vision. But we need certainty about investment framework," he added.