Sunday, February 20 2005 14:18 Hrs (IST) - World Time -

New Delhi: Within three months of adding to mobile phone capacity by eight lakh in two metros (Delhi and Mumbai), the state owned MTNL (Mahanagar Telephone Nigam Limited) today (Feb 20, 2005) announced another round of expansion in GSM mobile phones and said up to Rs 2,000 crore would be invested in the next financial year.

"We are growing much faster as compared to our rivals in the private sector. We added 44,659 new customers in January this year in Delhi only and this formed 53 per cent of the total added subscriber. Similarly in Mumbai our addition was 50,102 in January," MTNL CMD R S P Sinha told reporters adding if this trend continues we may require additional capacity much sooner than we expected.

Asked what plans the corporation had to ensure that MTNL's capacity does not become a problem, Sinha said we shall be inviting tenders soon. New capacity of four lakh lines each in Delhi and Mumbai should be completed within first half of 2005-06, he added.

According to Sinha, in January, against MTNL's 53 per cent share in the net addition, leading private GSM players like Bharti managed to take away only 15 per cent (12,992), Hutch only 10 per cent (8,275) and Idea added 18,599 new subscribers in Delhi.

In Mumbai also, the private players were far behind MTNL space.

MTNL's market share in Delhi moved up to 8.11 per cent at the end of January, 2005 from 5.11 per cent in February last year, while in Mumbai its market share stands at 9.97 per cent, he said adding, we took aggressive decisions last year and results are here for everyone to see.

Delhi and Mumbai are the most matured, competitive and aggressive markets and we are not only competing with the leading private players but moving much faster, Sinha said.

On the source of funding, he said all investments ranging between Rs 1800 to 2000 crore would be made from internal accruals and ruled out going to market for borrowings.

Besides adding capacity in GSM, Sinha also announced adding up to four million lines in the next generation mobile telephony called 3G. Tender has already been floated and is targeting to complete the 3G project by end of 2006-07.

In its last phase of expansion, Motorola had supplied equipments and the total cost of the project was about Rs 227 crore (Rs 2.27 billion) in Delhi and Rs 216 crore (Rs 2.16 billion) in Mumbai, he added.

MTNL has pumped in about Rs 450 crore (Rs 4.5 billion) for the GSM expansion.