Pakistan to Auction New LDI Licenses as Binding Term with Etisalat Expires

Government of Pakistan’s binding of not issuing any new LDI license based on the sale-purchase agreement with Etisalat – under the sale of 26 percent shares of PTCL – got expired on March 22nd, 2013, after which Pakistan Telecommunication Authority is free to auction new LDI licenses now.
Sources familiar with matter told ProPakistani that telecom regulator is likely to auction new LDI licenses, at least to CMPak which is long struggling to get LDI license but was barred due to government’s SPA with Etisalat.
CMPak had once said that it could invest USD 500 if granted an LDI license.
Pakistan Telecommunication Authority, which is fighting hard to get its governing board (including Chairman and two Members) is likely to auction LDI licenses as soon as it will get its board back.
Auction of new LDI licenses are specifically crucial now when operators are charging high for international incoming calls. There are currently 14 LDI operators that are making five times more revenues after implementation of ICH when compared with their previous earnings.
It merits mentioning here at the time of sale of 26 percent shares of PTCL, Etisalat had confined government of Pakistan to not to sell any new telecom license for seven years. The term of this contract expired last month and now PTA is free to auction new telecom licenses.
Insiders tell that one reason of not auctioning 3G license till now was this SPA with Etisalat.
It won’t be out of place to mention that Etisalat is still to pay USD 800 million even after seven years of its takeover of PTCL. Etisalat says that it will clear pending payment after settlement of land properties with government of Pakistan.
Etisalat was even offered to deduct the cost of properties (worth USD 73 million) and to clear the remaining amount, which it has been denying.
Pakistan had once said that it could take back the control of PTCL if pending payment isn’t cleared, however, that turned out to be a just a statement.
Sources