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India's telecoms king bids to conquer Africa

From Christian Purefoy, CNN
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Indian communications giant Bharti Group is expanding into Africa
  • Sunil Mittal is the founder and CEO of Indian telecoms giant Bharti Group
  • The group recently expanded into Africa by buying the assets of Zain in 15 African countries
  • Mittal says Bharti's cheap tariffs and widespread networks will be a success in Africa

CNN's Marketplace Africa offers viewers a unique window into African business on and off the continent. This week Christian Purefoy speaks to Sunil Mittal, CEO of Indian telecoms giant Bharti Group, about its expansion into Africa.

(CNN) -- As the founder and chief executive of telecoms giant Bharti Group, Sunil Mittal is one of India's most successful business leaders.

The 53-year-old entrepreneur is widely credited with starting the cell phone revolution in India, bringing mobile phones to the masses.

And now he has set his sights on the African market, following Bharti's recent acquisition of the African assets of Zain -- Kuwait's biggest phone operator -- in a deal worth $10.7 billion.

Mittal sat down with CNN's Christian Purefoy and talked about what he hopes to accomplish in Africa.

CNN: You're the largest mobile operator in India -- why have you come into Africa?

Sunil Mittal: Well, I can really preface that by saying, why not? We have been looking towards Africa for a long period of time so our entry into Africa has been part of a very well-considered strategy of carrying the low-cost, high-volume minutes factory that we've developed in India to be brought into Africa. So when Zain came to us as an opportunity we were very quick to move onto that.

CNN: This is one of the biggest, if not the biggest, investment by India in Africa -- over $10 billion dollars. What do you feel you can bring from India to Africa?

We are here to reclaim India's glorious relationship with Africa.
--Sunil Bharti Mittal, chairman of Bharti Group

SM: For our business model to succeed you need to have scale. As you deepen your networks into more rural, difficult, areas and as you re-balance tariffs you see the usage going up -- both of existing customers and new customers that come onboard.

So, I'm very confident that our model of low-cost affordable tariffs and widespread networks will bring an amazing difference to the countries we want to be in.

CNN: Africa is, of course, not India. What are the challenges you've faced and are still facing?

SM: I think infrastructure -- we're deep in the Indian Ocean, we're in mountains in Kashmir, so we've handled tough terrains but some of the areas here are tougher in terms of availability of electricity.

And finally -- I say this in India and I can say it here -- use telecoms as a tool for development and not necessarily as an industry that needs to be taxed the most.

While a government needs to get its taxes and share of revenues, I think it needs to be moderated so that the companies can plough back investment into more rural areas, making countries internet-ready and bridging the digital divide.

CNN: You have some very entrenched competition here -- MTN -- is that going to be a challenge?

SM: We are a product of competition. I wouldn't be sitting here in front of you if competition was not allowed in our country. I'm a first-generation entrepreneur -- we got a chance to compete with the big boys and we took them and we did better because we understood the customers' needs better.

When we come here we have a dominant player, like in Nigeria we have one. We're confident we will shake the market, we will claim our position, and the passion with which we have built this company replicated here in Africa and particularly in Nigeria. But I have to say, out of the 16 countries, we are number one in 11.

CNN: A lot of people talk about mobile phones bringing social development, changing the lives of people. Do you want to do that or is this a business?

SM: Well, at the basic starting point it's got to be a business. To my mind if the business does not do well, everything else becomes talk. You can just say that you want to do good things but you are not in a position to do so. But this company's DNA is one of social good.

CNN: Everyone talks of Chinese investment into Africa -- as we've said this is one of the biggest investments by India in Africa. Are you finding that you are welcomed here?

SM: Absolutely. I can tell you India and Africa have had a long-standing history; our ties are not recent, our ties go back centuries.

I have to confess in the last 10 years, the Chinese have taken a big space that we've vacated in Africa as Indians. I personally believe that our coming into Africa has rekindled big activity in the Indian corporate boardrooms.

We are here to reclaim India's glorious relationship with Africa. The welcome here as an Indian company is absolutely fantastic. We can say that people want a balance between India and China investing into Africa and our welcome suggests that African countries are keen for India to take a bigger position in Africa.