Over the years, efforts to expand the telecom sector in Nepal have met with many challenges. Nepal’s mountainous topography has made it extremely difficult to develop its telecommunications infrastructure. Furthermore, Nepal had been struggling under an adverse economic situation caused largely by political instability. A period in which acts of terrorism were common and the Maoist rebels were operating throughout the country had taken its toll on the telecom network – both directly and indirectly. This has changed with the rebels laying down their arms and becoming part of the political process. But, more recently it has been the tardiness of the government in addressing market reforms and developing national policies that has been weighing on the overall development of the telecom sector.
The country has certainly been on a road to recovery from the long years of civil unrest. Nepal’s transition to a considerably more stable nation began in 2007. The country’s first elections for over nine years were held in 2008; a clear victory going to the Maoists who were as a result to become a party of government. Although the way forward was not necessarily going to be smooth, with this remarkable turnaround following years of great difficulty, the scene was set to build on the considerable progress already made in recent times in meeting the growing demand for telephone services. Not only has there been strong subscriber growth, especially in the mobile sector, but there was evidence of a clear vision in the sector, including putting a reform process in place and planning for the building of necessary telecommunications infrastructure. Most importantly, the Ministry of Information and Communications (MoIC) and the telecom regulator, the National Telecommunications Authority (NTA), both became very active in the performance of their respective roles. However, as already noted, by 2014/2015 there was evident concern that some of the momentum of the reform process had been lost.
The Nepal Telecom Company, the state-owned incumbent operator, has been the major builder and operator of the national telecom network. For a long time it held a monopoly over all aspects of telecom in the country. With the opening up of the market, Nepal Telecom lost its monopoly on basic telecom services a little more than a decade ago with the licensing of United Telecom Ltd (UTL). It subsequently surrendered its monopoly on mobile services with the licensing of Spice Nepal Pvt Ltd, later known as Ncell, in 2004. The period after 2006 saw notably strong subscriber growth, especially in the mobile segment of the market. Mobile penetration went from 5% in 2007 to 95% in 2015.
Despite all the energy that has gone into the sector, there was still a significant disparity between the high coverage levels in the cities and the coverage available in the underdeveloped rural regions. Progress on providing some minimum access had been good, however.
Nepal Telecom; Nepal Doorsanchar Co Ltd (NDCL); United Telecom Ltd (UTL); Ncell; TeliaSonera; STM Telecom Sanchar Pvt Ltd; Nepal Satellite Telecom Pvt Ltd (NSTPL); Smart Telecom Pvt Ltd (STPL).
Number of pages 54
Last updated 11 Jan 2016
Analyst: Peter Evans
Paul, Many thanks for your inputs yesterday. You provided a compelling different perspective to our traditional infrastructure focus and this is valuable for our future planning. I also had very favourable feedback from our participants on your involvement.
Stephen Negus, Aurecon
Bahrain - Telecoms, Mobile and Broadband
US$215.00 until 5 Oct 2016
(normal price US$435.00)
Iran - Telecoms, Mobile and Broadband
US$210.00 until 5 Oct 2016
(normal price US$420.00)
A selection of downloadable samples from our Annual Publications catalogue.
Have the latest telecommunications industry news delivered to your inbox by subscribing to Paul's FREE weekly News & Views.