Telenor's CEO has also categorically denied any borrowing from local banks for GrameenPhone. "Our external investment coupled with continuous reinvestment of GP's profit has created the only cellular mobile network that today covers the country's 95 percent population."

"We have done our part by deploying the nationwide network and connecting all these people depends on the rationalisation of policy and regulations," he observed.

He said GP repatriated US$70 million profit from Bangladesh in nine years while it invested more than $750 million and paid in excess of $700 million taxes and fees to the government since launching its services in 1997.

"Besides investing $150 million during 2006-07, GP will contribute at least $28 million (Tk.2,000 crore) to the exchequer this year alone," Baksaas said.

Baksaas has also urged Bangladesh government to remove taxes on SIM cards. He calls such taxation as equally counterproductive for the market and the government.

"Pakistan had 13 million mobile phone subscribers until December 2005 and it became 27 million in three months as a result of slashing the SIM tax. He said similar growth is also attainable in Bangladesh and the mobile industry can increase its contribution to the exchequer too. Baksaas has also praised Pakistan's fixed-mobile operators' revenue sharing and interconnection regime.

Generally the cellphone operators tend to acquire initial penetration through the urban market followed by extending the network coverage in rural Bangladesh. "But GP has been simultaneously deploying its network in the urban and rural areas since inception."

Baksaas said GP has 62 percent market share and it will continue to lead with enhanced quality, extended coverage and versatile products.

Telenor is Norway's largest telecommunications provider and the Norwegian Ministry of Trade and Industry owns its 54 percent shares. Telenor Group's mobile operations contributed 57 percent of its $11.21 billion revenue in 2005. It has controlling stakes in the following mobile operations:

Telenor in Norway, Sonofon in Denmark, Vodafone Sweden, Kyivstar in Ukraine, Pannon in Hungary, ProMonte in Montenegro, DTAC in Thailand, DiGi in Malaysia, GrameenPhone in Bangladesh and Telenor Pakistan. Telenor also owns 29.90 per cent of Russia's VimpelCom and Connect Austria's 17.50 per cent share.

Telenor's CEO recognises competition in the matured as well as emerging cellular mobile markets. "Reducing the capital and operational costs while improving the quality of networks is a must in the industry." He, however, does not see any benefit in outsourcing of network operations a suitable cost-cutting measure.

"We have had disappointing experience in Telenor Pakistan's Managed Service Contract because the equipment supplier has failed to maintain Telenor's key performance indicator." Baksaas prefers to build Telenor's own human capital to run the cellular mobile networks regardless in Europe or Asia.

Telenor's CEO has admitted cellular mobile technology is facing competition from Wi-Fi and WiMAX technologies. "Any new technology initially appears threatening but it eventually compliments." He cited the example of VoIP, which first emerged as a "killer application" but now being widely provided by the telecoms operators.

In this context Baksaas underscores the significance of yet to be launched SEA-ME-WE4 submarine cable in Bangladesh. He believes it will reduce the cost as well as improve the quality of overseas phone calls. "While roaming in Dhaka I experience noise, echo and delay as the calls are passing through satellite links and that will not happen once the submarine cable takes over the international traffic."

While commenting on the European Commission's recent move to force the mobile operators to reduce roaming charge, Baksaas believes this issue should be left with the market. He said Telenor's European customers enjoy highly competitive tariff while roaming in Telenor's network in Thailand.