Sri Lanka wins Malaysian money

The mobile phone industry is growing fast

Telekom Malaysia plans to almost double investment in its wholly-owned Sri Lankan mobile phone network, in one of the country's biggest foreign investments since the peace process began.

The government of the South Asian island state and Tamil Tiger separatists started talks to end two decades of civil war last year.

An extra $90m will be pumped into MTN Networks, parent of Sri Lanka's largest mobile phone operator Dialog, raising Telekom's commitment to $200m.

The new investment by Malaysia's state-owned telecom company would be used to provide better service in the south of the country.

The funds would also pay for further expansion into the Jaffna peninsula, the strong hold of the Tamils, where there was little infrastructure investment during the war.

Fast expanding

"We consider it (MTN Networks) to be one of the best success stories outside of Malaysia," Telekom chairman Muhammad Radzi Mansor said.

Telekom is a veteran of the fast expanding Sri Lankan telecoms market, which it entered in 1995.

MTN Networks counts almost half of Sri Lanka's one million mobile phone users as its customers.

Its main competitor is the fixed-line operator Sri Lanka Telecom, in which Japan's Nippon Telegraph and Telephone has a 35% stake.

There are now three fixed-line operators and six mobile operators.