The number of GrameenPhone mobile users crossed 6.5 million in April, although the growth dropped substantially after imposing SIM tax and making registration compulsory for new clients.

The market growth slumped due to two reasons -- imposition of tax on subscriber identity module (SIM) cards and newly introduced registration process for new subscribers, Erik Aas, chief executive officer of the GP, told a press briefing in Dhaka yesterday.

"Given the right conditions, I would not be surprised if we have more than 2 crore mobile phone users in Bangladesh by the end of 2006," he noted.

But the market is not growing at the expected pace as lots of people do not

have required identify cards or gun licences, the GP CEO added. "It has become difficult for people to get connected due to higher SIM tax."

Aas said the company is expected to contribute more than Tk 2,000 crore to the state coffer in 2006 alone. GrameenPhone Ltd has contributed more than Tk 5,000 crore to the state coffer in taxes, duties and payments to various government bodies since its inception in 1997, he said.

"Major portion of the duties and taxes is coming from value added tax (VAT) -- not from SIM tax," Aas said arguing that the VAT would increase substantially if it was possible to sell SIM at lower prices.

In 2005 alone, the prices went down with more than 30 percent and monthly charges have been reduced or removed. The latest promotion with only Tk 0.80 per minute is a clear example of new benefits to the GP customers.

"Mobile phone in Bangladesh is getting more and more affordable,” he said observing that prices will go down further in 2006 and 2007.

GrameenPhone has just stepped into its 10th year of operation. It is the leading telecommunications service provider in the country with more than 65 lakhs subscribers.

Until now, more than Tk 5,200 crore has been invested in the GP network, he said. "Even it is not enough as we need to improve the quality and capacity of the network."

Most parts of the country are fully covered, and currently there are investment programmes to improve highway coverage, indoor building quality and a constant improvement of capacity across the country, he mentioned.

Aas said GP invested US$ 300 million in 2005 alone and a substantial amount of investment will also be made in 2006 to improve the quality and capacity of the company.