KARACHI, Jan 14: With the end of exclusive right of the Pakistan Telecommunication Company Limited (PTCL) on all core infrastructure services including international data and voice- services on December 31, 2002, Pakistan’s telecom sector stands deregulated starting 2003.

Yet, analysts do not see major new telecom company entering the Pakistan market in the near term.

A report on the telecom sector prepared by stock brokerage firm, Taurus Securities says that until the telecom policy is announced—which is under preparation—no new major telecom company is likely to enter the sector in Pakistan. Analysts say that some of the world’s largest telecom companies are in bad shape internationally, which is why they do not expect to see significant inflow of foreign investment in Pakistan’s telecom sector in 2003.

Locally, however, the sector could post a reasonable domestic growth at 9.5 million fixed line a year by PTCL and the mobile phone segment— which is already open to competition— looks set to double cell phone market annually.

PTCL owns and operates the public switched telephony network in Pakistan and various other telecommunication services. It is currently the sole provider of all core infrastructure services including international data and voice services. “We believe PTCL will not face any competition in fixed line segment, even after the market is opened to competition, as that is not a growing segment and heavy investment of time and money would be required for another company to set up its own infrastructure,” analysts at Taurus say.

PTCL divides its revenues into two main segments; international revenue and domestic revenue. International calling rates, also called the accounting rates, have been declining in the last few years due to increased competition internationally. Analysts contend that the situation would further exacerbate by the WTO regime that is effective from January 2003.

However, the reduction in rates is being compensated by a strong growth in international incoming traffic. The growth seen in PTCL’s revenues is due mainly to the domestic segment “to offset the impact of reduced international settlement rates and align with global trends, the domestic tariffs were raised by the Government in 2001,” analysts say.