Wataniya Mobile is threatening to pull out of the West Bank, citing the Israeli government’s refusal to provide the full bandwidth agreed in 2008.

The company is a subsidiary of Qatar’s state-owned telecoms group, Qtel. A Palestinian Authority private investment fund also owns a minority stake in the company.

Wataniya has not been provided with the 4.8 megahertz of bandwidth promised by Israel to the Palestinians in a deal agreed in July 2008. The bandwidth was supposed to be supplied in two tranches by March but Israel has only just agreed to supply 3.8Mhz.

Wataniya says this is insufficient to compete with Israeli and Palestinian telecoms providers.

The company’s withdrawal would be a huge blow to the Palestinian economy. Wataniya expected to invest $700m and generate 3,000 jobs indirectly in the Occupied Territories.