Bharti invests another $1 billion into African operations

25 May 2011 |


Indian operator Bharti airtel has said it will invest a further $1 billion into its operations in Africa despite claims that its existing investments in the continent are to blame for a dramatic fall in its profitability.

The company’s latest annual report, released earlier this month, showed a 32.6% reduction in profits compared to the previous financial year to which it attributed its African operations as the cause.

Bharti group chief, Sunil Mittal, explained that the business has already invested $11 billion in the 16 African states where it has a presence, but remains committed to further expanding, improving and integrating its network assets.

Mittal said the region still held great opportunities for growth, and encouraged other Indian businesses in invest there.

This view was echoed by Anup Gupta, business head of the group’s global data business in the Middle East and Africa, who stressed the importance of time in establishing its position in the region. “It takes time to establish credibility in the market,” he said. “This business is all about huge networks and requires critical links for connectivity and this crossover has to be built over a period of time. We need to figure out how to balance this presence with the partnerships we have formed.”

Bharti bought the African operations of Kuwaiti operator Zain last year in a landmark $10.7 billion deal.

It recently announced a five-year deal with mobile solutions vendor Comviva to help it deliver value-added services across its operations in Africa, and earlier this year confirmed that it was outsourcing much of the IT behind the African operations to IBM.