The international and local telecom companies have significant presence in the country as these companies are successfully doing business and they invested more than US$ 12 billion including US$ 6 billion Foreign Direct Investment (FDI) during seven year from 2005 to 2012.
However, during recent years, as telecom companies have already established most of their networks, companies have reduced their investments.
A data issued by Pakistan Telecommunication Authority (PTA) on Wednesday revealed that telecom sector attracted substantial foreign investment after the deregulation. This increase in investment is mainly contributed by cellular mobile segment followed by Fixed Local Loop (FLL) and Wireless Local Loop (WLL).
The segment-wise investment data showed that during 2007-08 cellular area attracted US $ 2337.7 billion which gradually reduced to US $ 211.8 million in 2011-12 and US$ 421.5 in 2012-13.
The Long Distance International (LDI) area attracted US$ 403.9 million in 2007-08 and the investment also reduced to US $ 16.2 million in 2011-12 and US$ 1.9 million in 2012-13.
The total investment in Cellular, LDI, Local Loop (LL) and WLL was US $ 3.136 billion in 2007-08 and reduced to US $ 472 million in 2012-13.
The data further revealed that recently, cellular mobile companies have also increased investments in their networks in anticipation of upcoming 3G/4G services in the country.
Despite the excellent growth in overall investment, Foreign Direct Investment (FDI) still remained on the negative side of the scale due to more capital outflows by companies than inflows.
The negative FDI of US $408 million during the 2012-13 can possibly be turned around by conducting further spectrum auctions such as 3G auction to introduce new technology in the country and resultantly bringing substantial foreign investment into the country.