The new licence comes as part of a programme to upgrade and restructure the telecoms sector and the Telecommunications Company of Iran (TCI). The programme includes the establishment of an independent regulatory body and the expansion of the fixed and mobile telephone network by the end of the third five-year development plan in March 2004. New targets for the telecoms sector were announced following the appointment of Ahmad Motamedi as the new PTT minister in August.

Kermanshah said that the ministry aims to increase the number of mobile phone lines to 10 million in 2004 from 1 million at present. ‘The ministry is committed to achieving the 10 million user figure, but a second carrier will be needed because TCI cannot reach this target on its own,’ Kermanshah said. He expects the tender for the second licence to be announced within the next 12 months. In addition, companies will be invited to bid for contracts to upgrade the existing mobile network, which is performing below international standards.

Plans have also been drawn up for the fixed-line network. Capacity is set to increase by 10 million lines to 20 million in 2004, with a new tender for the expansion of the network to be issued soon. Germany’s Siemens, France’s Alcateland NECof Japan, which are involved in the countrywide installation of an additional 2.5 million lines, are expected to be among the bidders for the new expansion scheme.

TCI is also pressing ahead with plans to appoint an international firm to review Iran’s tariff structure. ‘We want to establish profitability at more competitive prices,’ Kermanshah said.

The company has not yet decided how to open the fixed telephony sector, but is considering several options. ‘We want to allow competition in many areas, but the backbone of the fixed-line network will remain in TCI’s hands.’

Among the key developments in the telecoms sector will be the establishment of an independent regulatory authority, overseeing standards of s ervices, sector expansion and implementing tariff structures. ‘We want to restrict ourselves to being a regulatory body and will begin restructuring before the end of the year,’ Kermanshah said.

Ali Kermanshah was a speaker at the Investing in Iran conference, organised by IBC Global Conferences in London on 25 October