ASHGABAT: Turkmenistan said on Saturday it would privatise its mobile telecoms market, where state-run TM Cell now operates as a monopoly after the licence of Russian operator MTS was suspended in December.

MTS, Russia's top mobile operator, has brought legal action against the Communications Ministry of Turkmenistan over the unexpected licence suspension.

MTS's Turkmenistan operations accounted for about 2 percent of its total revenue.

Before MTS was abruptly deprived of its frequencies in Turkmenistan and told to dismantle its equipment, it held an 85 percent share of the local market. TM Cell held the rest.

"There must be competition among mobile telecoms companies," Turkmen television quoted President Kurbanguly Berdymukhamedov as saying.

Berdymukhamedov, who enjoys sweeping powers in the gas-rich Central Asian nation, also said that in the future "there must be no less than three mobile telecoms operators independent from the state".

He said Turkmenistan would still retain over 50 percent in those new telecoms firms, but they would be allowed to form joint ventures with foreign partners. He gave no details or timeframe for privatisation of the telecoms market.

MTS has said it expects to write off $160 million immediately if it does not resume operations in Turkmenistan, and incur total losses of about $600 million.