Country overview: Bangladesh
Mobile industry driving growth and enabling
digital inclusion
Copyright © 2018 GSM Association
 2
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This report was authored by
Mike Rogers, Senior Analyst
GSMA Intelligence
COUNTRY OVERVIEW: BANGLADESH
Contents
1
1.1
1.2
1.3
1.4
2
2.1
2.2
3
3.1
3.2
3.3
3.4
3.5
3.6
4
Executive summary 2
Bangladesh as a digital society 6
Bangladesh in numbers 7
Country context, Vision 2021 and Digital Bangladesh 9
How mobile supports achievement of the SDGs
and Vision 2021 12
Mobile makes a vital contribution to the economy
of Bangladesh 15
Bangladesh mobile market overview 18
Sustained growth as mobile penetration reaches
half the population 19
Focus shifts to mobile broadband adoption 21
Accelerating the impact of mobile on Vision 2021
and the SDGs 26
Aordability represents a major barrier to uptake
of mobile services in Bangladesh 28
Improving access in Bangladesh through
mobile-enabled services 31
Falling smartphones prices will help drive smartphone
adoption to three quarters of total connections by 2025 34
Spectrum and tax barriers reduce operators’ ability
to invest in network coverage and expansion 35
Tax reform can facilitate greater investment and
improve aordability 40
Allowing all types of network infrastructure sharing can
increase accessibility and help close the coverage gap 41
A forward‑looking regulatory environment 44
Executive summary 2
COUNTRY OVERVIEW: BANGLADESH
Executive summary
COUNTRY OVERVIEW: BANGLADESH
Executive summary 3
A burgeoning mobile industry, but significant challenges to digital
inclusion remain
 “for”referstoGBofdatacostinglessthanofmonthlyincome
 Targets“ConnectingtheOtherHalf”UNBroadbandCommission
The mobile industry in Bangladesh has scaled rapidly
over the last decade to become the fifth largest mobile
market in Asia Pacific, with 85 million unique subscribers
in 2017 – half the population. By helping to promote
digital inclusion and support the delivery of essential
services, the mobile industry makes a vital contribution
to the economy of Bangladesh and plays a crucial role
in supporting the achievement of the government’s
Digital Bangladesh and Vision 2021 initiatives, as well
as the UN’s Sustainable Development Goals (SDGs).
However, with a predominantly 2G mobile market,
the country faces a significant digital divide: only one
in five Bangladeshis subscribed to mobile internet
services in 2017, despite 3G networks covering in
excess of 90% of the population. Bangladesh has one
of the lowest internet penetration levels in the region.
While network coverage remains a barrier to access,
particularly in rural and remote areas of the country,
coverage by itself does not guarantee access.
The enablers critical to creating the right conditions
for mobile internet connectivity to flourish rank low
in Bangladesh, despite the progress made in recent
years. In particular, the country scores below average
on infrastructure and aordability enablers relative
to its regional peers. The slow transition to mobile
broadband technologies in Bangladesh is also, in part,
a matter of timing: the 4G/LTE spectrum auction only
took place in February 2018, following similar delays
to the 3G auction, making Bangladesh one of the
last countries in South Asia to award licences for the
technologies.
Aordability represents a major barrier to the uptake of mobile
services in Bangladesh
A higher cost of mobile access will have a greater impact
on the poorest consumers, as it constitutes a higher
share of their monthly income. A medium consumption
basket of 1 GB of data would cost an individual in the
bottom 20% by income distribution approximately
11% of their monthly earnings in Bangladesh, above
the “1 for 2”
1
aordability threshold recently adopted
by the United Nations.
2
High levels of taxation and
fees applied to the mobile sector aect the total cost
of mobile ownership (TCMO) by directly raising the
retail prices faced by consumers, and thus represent a
significant barrier to digital inclusion. For example, taxes
on the use of mobile services in Bangladesh represent
a higher share of tari costs (22%) than in a number of
neighbouring countries.
Owing to a sustained period of economic growth, by the time of
Bangladesh’s 47th anniversary of independence in March 2018,
the country had reached lower middle‑income status. By the 50th
anniversary in 2021, Bangladesh aims to reach middle‑income status,
with poverty eradicated.
Executive summary 4
COUNTRY OVERVIEW: BANGLADESH
Spectrum and tax barriers reduce operators’ ability to invest in
network coverage and expansion
To date, the limited allocation of 3G spectrum in
Bangladesh and its price in previous auctions has
had a significant negative impact on the quality of
mobile services, hindering the uptake and use of
digital services. With the February 2018 spectrum
auction, Bangladesh policymakers made important
steps towards introducing 4G/LTE services in the
country, in support of Digital Bangladesh. However,
high auction reserve prices and associated licence fees
remained. When coupled with a mobile market with
some of the lowest ARPU levels in the world, some of
this high-priced spectrum went unsold. This highlights
the importance of setting reserve prices for future
spectrum auctions at levels that consider operators’
needs to not only finance access to spectrum, but also
to deploy infrastructure to use that spectrum. This will
become even more important as mobile broadband
adoption scales and increased data demand further
strains networks, requiring even greater access to
spectrum. Without sucient spectrum, quality of
service for users will suer, impeding the use of digital
services. The government should ensure both the
timely release of spectrum and fair prices for access
to that spectrum to facilitate better quality and more
aordable services.
Although taxes and fees from the mobile industry
remain an important source of revenue to finance
public expenditure in Bangladesh, the current tax
system is not conducive to improving the aordability
of mobile services. Taxes and fees on the mobile sector
in Bangladesh are disproportionately high relative to
other sectors in the economy and to other countries in
Asia, and are often levied in ways that do not account
for key investment and economic features of the
industry. In 2014, the mobile industry in Bangladesh
made a large contribution in taxes and fees relative
to its size in the economy: tax and fee payments from
the sector, as a share of total tax revenues, were 4.5×
greater than the sector’s revenue as a share of GDP.
A forward-looking regulatory environment will help boost the uptake
of mobile internet services
As Bangladesh progresses to a more advanced digital society, promoting and extending connectivity has
the potential to deliver substantial social and economic benefits to the country. It is therefore crucial for the
regulatory and legal environment to recognise that mobile industry dynamics have evolved in recent years.
Through review, reform and modernisation of regulation in key areas, policymakers and the regulator in
Bangladesh can play a major role in expanding mobile broadband access and adoption across the country,
supporting progress with Vision 2021 and the SDGs.
A long‑term roadmap for spectrum at
aordable prices is required
The government of Bangladesh should create a
predictable roadmap for future assignments of
spectrum (e.g. 700 MHz), in consultation with industry
players to ensure fair and reasonable policies and
regulations while also supporting eective pricing of
spectrum. This will help create a stable and transparent
investment environment that takes into account
the long lead time required for network rollout and
expansion, while also facilitating better quality and
more aordable services.
Rebalance taxation in line with
best‑practice principles to improve
aordability and foster investment
Reforming taxation applied on the mobile sector
towards a more balanced and ecient structure,
in line with principles established by international
organisations, can increase aordability of mobile
products and services, and can add further value
to the economy through productivity gains and the
knock-on impact on other industries. Tax rules should
be clear and simple to understand, so that taxpayers
can anticipate the tax consequences in advance of a
transaction. Abolishing inconsistent application of tax
rules will provide a better investment climate.
Executive summary 5
COUNTRY OVERVIEW: BANGLADESH
Allow all types of network sharing to
facilitate mobile broadband expansion
Network sharing oers an opportunity to help
bring mobile internet services to all Bangladeshis,
particularly those in rural and remote areas. The
government should allow all types of network
infrastructure sharing including MORAN, MOCN
and roaming. As part of this, infrastructure sharing
should remain optional for mobile operators; forcing
them to share infrastructure creates a disincentive to
deploy new infrastructure and may negatively aect
investment and coverage.
Rationalise licensing regime to support
quality of service for the consumer
and improve the investment climate
The current licensing regime in Bangladesh is highly
fragmented and complex, with multiple licensees/
entities (in addition to mobile operators) participating
in the service delivery value chain. The government
of Bangladesh should seek to rationalise the licensing
regime and reduce the unpredictability of licensing
changes to improve the investment climate and thus
support the overall experience for mobile users.
Reform regulation to realise the full
potential of mobile financial services
Emerging services including mobile financial services
(MFS) and mobile agriculture (mAgri) services can
help accelerate productivity and financial inclusion
throughout the economy. The government should
create an open and level MFS playing field that allows
both banks and non-bank providers to oer storage
and payment services – particularly operators, which
are well suited to building sustainable services and
extending the reach of the formal financial sector.
Bangladesh as a digital society 6
COUNTRY OVERVIEW: BANGLADESH
1
Bangladesh as
a digital society
Bangladesh as a digital society 7
COUNTRY OVERVIEW: BANGLADESH
1.1 Bangladesh in numbers
Source: World Bank, UN, ILO, Bangladesh Bureau of Statistics
Bangladesh: key facts
Dhaka
Capital
161 million
Total population
Ocial language
Bengali
147,630 sq km
Land area
GDP GROWTH
$1,330
South Asia average $1,616
GNI PER CAPITA (CURRENT $)
Lower middle income
DHAKADHAKA
6.1%
7.1%
6.6%
7.5%
6.8%
7.1%
Bangladesh
South Asia
PEOPLE
1,252 people/km
2
Population densityPopulation
one of the highest in the world:
3× that of India and 5× that of Pakistan

INCREASING URBANISATION
EVEN GENDER SPLIT
YOUNG POPULATION
Male 50.5%
Female 49.5%
0–14 year-olds 29%
15–24 year-olds 19%
25–39 year-olds 25%
40–64 year-olds 21%
64+ year-olds 5%

Rural Urban
35%
30%
24%
2
0
1
6
2
0
1
0
2
0
0
0
201620152014
7.1%
171
million
by the end of 2020
Bangladesh as a digital society 8
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence
Bangladesh: mobile market snapshot
3
 BangladeshBureauofStatistics
81%
43%
62%
76%
70%
73%
3.7%
4.7%
4.1%
Labour force
participation
Literacy Unemployment
Male
Total
Total
Female
Male
Female
2016
2016
of income of income

TOP 20%
53%

BOTTOM 20%
4%
compared to 52% and 5% in 2010
3
INCOME DISTRIBUTION BY HOUSEHOLD
40 million
people still live in poverty
compared to 48 million and 27 million respectively in 2010
20 million
live in extreme poverty ($1.90 per day)
UNIQUE MOBILE SUBSCRIBERS
MOBILE BROADBAND CONNECTIONS SMARTPHONES
UNIQUE MOBILE INTERNET
SUBSCRIBERS
TOTAL SIM CONNECTIONS
Ninth-largest mobile market in
the world by unique subscribers
*Excluding licensed cellular IoT
Smartphone adoption buoyed by growth in
low-cost devices
Mobile broadband adoption expected to accelerate,
with 4G services launched in 2018
2017 20252017
2017
2025
2025
45
million
29%
82%
31% adoption
138
million
75% adoption
3%
CAGR
2017
2025
10%
CAGR
2017
2025
3%
CAGR
 
85 million
51% penetration rate
107million
60% penetration rate
35 million
21% penetration rate
73 million
41% penetration rate
145 million
87% penetration rate*
190million
102% penetration rate*
Bangladesh as a digital society 9
COUNTRY OVERVIEW: BANGLADESH
1.2 Country context, Vision 2021 and
Digital Bangladesh
Since gaining its independence in 1971, Bangladesh has made considerable
progress across a number of key human development indicators and has
met several targets of the UN Millennium Development Goals (MDGs).
4,5
Extreme poverty levels have more than halved since 1990, while life
expectancy, primary school enrolment and literacy rates have improved
significantly. This progress has been underpinned by a sustained period
of economic growth, with GDP growing at 6% plus per annum over the
last decade,
6
which has resulted in Bangladesh reaching the lower middle-
income country status.
7
TheMillenniumDevelopmentGoals(MDGs)weretheworldstargetsforaddressingextremepovertyinitsmanydimensions(incomepovertyhungerdiseaselackofadequate
shelterandexclusion)whilepromotinggenderequalityeducationandenvironmentalsustainabilityby
httpwwwbdundporgcontentbangladeshenhomepost-millennium-development-goalshtml
 WorldBank
 Lowermiddle-incomeeconomiesarethosewithaGNIpercapitabetweenand
 BangladeshBureauofStatistics
 SeeSectionforadiscussionoftheroleofmAgriservicesinaddressingsomeoftheseissues
Yet, as Bangladesh undergoes rapid socioeconomic
transformation, substantial challenges remain. With
more than 161 million people, Bangladesh is the eighth
most populous country in the world. It also has one of
the highest population densities – three times that of
India and five times that of Pakistan. As such, despite
recent progress, poverty and inequality remain critical
issues: 40 million people remain in poverty and 20
million in extreme poverty ($1.90/day).
8
There is also
an increasing polarisation of wealth which has resulted
in the top 20% of the population capturing more than
half of income. These issues are most pertinent in rural
areas, where around 65% of the population live.
Although the economy of Bangladesh is experiencing
a period of industrialisation – through its ongoing
shift from agriculture towards manufacturing and
services – the country remains highly dependent on
agriculture and faces significant food poverty and
production challenges.
9
Going forward, these may
be exacerbated by continued population growth,
unplanned urbanisation and natural disasters. As one
of the most climate-vulnerable countries in the world,
climate change will further intensify the coping and
adaptive challenges in Bangladesh and will accentuate
broader socioeconomic challenges.
In recognition of the need to address these challenges,
the government of Bangladesh has demonstrated
its progressive development agenda through Vision
2021, the political vision of where Bangladesh needs
to be in 2021 – the 50th anniversary of Bangladesh’s
independence. The main goal is for Bangladesh to
become a middle-income country, with poverty
eradicated. An integral part of Vision 2021 is Digital
Bangladesh, which aims to bring socioeconomic
transformation through information and
communications technology (ICT). The key priorities of
Digital Bangladesh are:
• developing human resources ready for the
21st century
• connecting citizens in ways most meaningful
to them
• taking services to citizens’ doorsteps
• making the private sector and market more
productive and competitive through the use of
digital technology.
Bangladesh as a digital society 10
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence
Government development agenda in Bangladesh
Thus far, good progress has been made in all four
areas of Digital Bangladesh, with particular advances
in making government services more accessible to
citizens. One of the key drivers of this is the Access to
Information (a2i) programme, which aims to improve
quality, widen access and decentralise delivery of
public services to citizens of Bangladesh. Some of
the early results include training more than 200,000
civil servants and thousands of Digital Centre
Entrepreneurs to implement e-services centrally. More
than 4,500 Union Digital Centres have been launched
in the country to facilitate access to public services for
underserved citizens.
The long-term strategy for Vision 2021 was defined in
the Perspective Plan, while specific strategies and the
task for implementation were articulated through two
plans: the Sixth Five Year Plan (FYP) (2011–2015) and
the Seventh Five Year Plan (2016–2020). As part of
its strategy, the Oce for Public-Private Partnership
(PPP) was established to facilitate development
of core sector public infrastructure and services in
Bangladesh, and support achievement of the goal to
increase infrastructure investment from around 2% to
6% of GDP, which will help close the infrastructure gap.
The 7th FYP coincided with the launch of the UN
Sustainable Development Goals (SDGs), in September
2015, with all 193 UN member states, including
Bangladesh, adopting them. The aim of these goals
is to end poverty, protect the planet and ensure
prosperity for all. The Bangladesh government has
embraced the SDGs and incorporated them in its
Seventh FYP, as summarised in Figure 2.
1
WHAT
HOW
Vision 2021
Sixth Five Year Plan Seventh Five Year Plan
Digital Bangladesh
The main goal is for Bangladesh to become a middle income
country, with poverty eradicated
Perspective Plan
(2010–2021)
The Perspective Plan is the roadmap for achieving the targets of
Vision 2021; it lays down a long-term strategy to make that happen.
Bring socioeconomic transformation through information and
communication technology (ICT)
Specific strategies and the task of implementation will be articulated through the two five-year
plans: the Sixth Five Year Plan (2011–2015) and the Seventh Five Year Plan (2016–2020)
Bangladesh as a digital society 11
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence
Seventh Five Year Plan and the SDGs
2
Seventh FYP category Related SDGs
Income and poverty
Sector development
Macroeconomic development
Urban development
Human resource development
(education, health and population)
Water and sanitation
Energy and infrastructure
Gender equality, income inequality
and social protection
Environmental sustainability
ICT development
Bangladesh as a digital society 12
COUNTRY OVERVIEW: BANGLADESH
1.3 How mobile supports achievement of the
SDGs and Vision 2021
“Connecting citizens in ways most meaningful to them” is one of the
main goals of Digital Bangladesh. As with most emerging markets,
internet connectivity in Bangladesh tends to be mobile-based, due to
limited fixed-line infrastructure – just 3.8% of the Bangladeshi population
subscribe to fixed broadband services,
10
compared to 51% mobile
penetration. By providing connectivity, mobile operators are uniquely
positioned to play a critical role in the development of digital societies,
with access to mobile services, devices and content helping to promote
digital inclusion and to bridge the digital divide, which in turn would
contribute to achieving the goal of making Bangladesh a middle-income
country. Mobile technology therefore plays a critical role in supporting the
achievement of the SDGs and Vision 2021 in Bangladesh.
 WorldBank
 BangladeshDrivingmobile-enabledigitaltransformationGSMA
The GSMA recently published a report – Bangladesh:
Driving mobile-enabled digital transformation 
11
–
examining in detail the positive impact mobile
technology has and will continue to have on the
people of Bangladesh, and how mobile technology can
accelerate Bangladesh’s progress towards attainment
of the SDGs and its Vision 2021.
The report delves into the priority areas and challenges
that Bangladesh faces in meeting these targets, and
what mobile can do to help address them; a brief
summary is provided below. Both the government of
Bangladesh and the mobile industry have demonstrated
strong commitment to supporting progress towards
Vision 2021 (and the SDGs). By collaborating more
closely on win–win opportunities that align with each
stakeholder’s organisational goals, the government and
industry have an exciting opportunity to unlock digital
transformation for millions of Bangladeshis.
• Closing the digital access gap: Despite 3G
networks covering 93% of the Bangladeshi
population, mobile internet uptake is still low,
at 21% in 2017. Prioritising eorts that target
barriers to adoption – including network quality,
spectrum availability at aordable prices, taxation,
aordability of services, lack of usability and skills,
and local relevance – will be key to closing the
digital access gap.
• Increasing basic literacy and digital literacy
skills: A limited number of education institutions
currently have access to the internet or computer
laboratories, and a limited number of teachers
tutor basic computer skills in primary or secondary
education. Government and mobile operators
can work together to initiate digital education
programmes for all, bring ICT into the school
curriculum and partner with trusted NGOs to
deliver hands-on training in digital literacy.
• Closing the gender gap: Eorts to help women
access mobile services help to catalyse broader
gender equality across the social, economic and
political dimensions, benefiting not only women
themselves but also their communities, businesses
and the broader economy. Women face similar
barriers to men in accessing the internet, such as
aordability and usability/skills, but more than
men face barriers related to safety and harassment
issues, and underlying social norms. Government
and mobile operators can work together to
empower women, making them more connected,
safer and able to access information, services and
life-enhancing opportunities.
• Improving health outcomes: Mobile operators and
the government can provide services for patients
to help prevent and manage non-communicable
diseases (which accounted for two thirds of deaths
Bangladesh as a digital society 13
COUNTRY OVERVIEW: BANGLADESH
in Bangladesh in 2015),
12
develop digital solutions
for patient data collection and reporting, and
digitise hospitals and clinics. Meanwhile, smart
vehicles connected by IoT/M2M mobile technology
can reduce congestion and collisions, contributing
to improved safety for motorists and pedestrians.
• Increasing agricultural productivity: In the
coming years, Bangladesh may have to face the
challenge of food insecurity due to its large and
growing population. Already the country has a high
prevalence of underweight and stunted children.
Mobile operators can work with agri-institutions
and agri-businesses to help boost productivity by
providing farmers with mobile-enabled information
services on agricultural inputs and nutrition, prices
for crops across markets and accurate weather
data, as well as supporting the digitisation of the
agri value chain.
• Increasing financial inclusion: Bangladesh is a
cash economy. Although mobile financial services
have been live in Bangladesh since 2011, through
a model where the bank is required to hold the
licence, more than half of the adult population
in the country (approximately 65 million) have
access to a mobile phone but remain unbanked.
13
Uptake and use of mobile money services can be
increased by digitising more payment streams,
 WorldHealthOrganization
 AccordingtoIntermediaFinancialInclusionInsights
 DigitalEntrepreneurialEcosysteminBangladeshATKearney
 UNHCRhttpwwwunhcrorgukfigures-at-a-glancehtml
 UNHCRGlobalTrendshttpwwwunhcrorgcdpdf
 TheroleoffinancialservicesinhumanitariancrisesCGAPWorldBank
 Forthepurposesofthisreporttheterm‘FDPs’includesrefugeesinternallydisplacedpersons(IDPs)egthosefleeingawarzoneandorrelocatingintheaftermathofa
naturaldisasterasylumseekersandotherpersonswhohavehadtoleavetheirhomesasaresultofanaturaltechnologicalordeliberateevent(Definitionadaptedfrom
httpiasfmorg)
 RefugeesandIdentityGSMA
 MobileMoneyHumanitarianCashTransfersandDisplacedPopulationsGSMA
 EnablingAccesstoMobileServicesfortheForciblyDisplacedGSMA 
which would benefit consumers, businesses and
the government.
• Supporting digital innovation: Given Bangladesh’s
large and relatively young population, the country
presents strong opportunities for innovative
start-ups and investors. The mobile industry, wider
internet ecosystem and government need to work
together to ensure that innovation can flourish. In
particular, they can encourage the development
of incubators, open up APIs to start-ups in the
country to further nurture the local ecosystem, and
help close the funding gap by setting up corporate
venture-capital funds that invest in local start-ups
at seed stage.
Although Bangladesh’s IT software and services
sector is now doubling every 18 months in revenue,
with total employment over 70,000 people, 1,000
start-ups, and nearly ten business incubators at
year-end 2016, these digital start-ups tend to target
only the domestic market, and most global internet
players avoid setting up operations in Bangladesh.
Moreover, neighbouring India has more than five
times as many software developers per equivalent
size of population, and Bangladesh’s e-commerce
market is embryonic, at just 2% of its retail market
in terms of revenue.
14
The case of refugee populations
The United Nations High Commissioner for Refugees
(UNHCR) estimates that, as of 2017, more than
65million people are forcibly displaced worldwide.
15
Many have been so for more than two decades.
16
An
additional 25.4 million people are displaced every year
due to natural disasters and climate-related events.
17
Forcibly displaced persons (FDPs)
18
often relocate
without any form of legal identification as it may
have been forgotten, lost, destroyed or stolen during
their journey, while those who are fleeing persecution
based on some aspect of their identity (e.g. nationality,
religion, ethnic group, sexual orientation, membership
of a particular social group or political aliation) may
decide not to travel with documentation.
19
GSMA research found that 19 of the top 20 refugee-
hosting countries, including Bangladesh, have
mandatory SIM registration policies in place
20
in
addition to know your customer (KYC) identification
compliance requirements for opening mobile money
accounts. To the extent that refugees are unable – at
least in the short term – to meet these requirements,
they risk being excluded from accessing both mobile
communications and mobile money services.
A recent GSMA report highlighted that enabling access
to mobile services can lead to positive outcomes not
just for refugees themselves, but also for humanitarian
agencies, host governments and local communities.
21
Bangladesh as a digital society 14
COUNTRY OVERVIEW: BANGLADESH
The report included policy recommendations for
host-country governments on how to address the
identification barriers and enable FDPs to access
mobile services. The emergence of new technologies
 BlockchainforDevelopmentGSMA
(such as blockchain) can also enable innovation in
areas such as digital identification and aid in the
context of international development.
22
Summary of recommended considerations for
policymakers on enabling mobile access for FDPs
In an eort to promote an enabling policy and regulatory framework, host-country
governments and regulators (including central banks) should consider adopting flexible and
proportionate approaches towards proof-of-identity requirements for forcibly displaced
persons to be able to access mobile services, particularly in emergency contexts. Such
approaches may include:
1 providing clear guidelines on what identification
is acceptable for FDPs to access mobile
services, and ensuring that a critical mass of
FDPs has access to an acceptable proof-of-
identity
2 allowing the use of UNHCR-issued identification,
where available, to satisfy any mandatory SIM
registration or KYC requirements for opening
mobile money accounts
3 enabling lower, ‘tiered’ thresholds of KYC
requirements to allow FDPs to open basic
mobile money accounts, particularly in
emergency contexts
4 harmonising identity-related SIM registration
requirements with the lowest tier of KYC
requirements in countries where SIM
registration is mandatory.
5 establishing proportionate risk assessment
processes that take into account the diverse
types of FDPs when considering ‘proof-of-
identity’ policies
6 exploring the use of new digital identity
technologies
7 promoting robust identification-validation
processes while adopting consistent data
protection and privacy frameworks.
Bangladesh as a digital society 15
COUNTRY OVERVIEW: BANGLADESH
1.4. Mobile makes a vital contribution to the
economy of Bangladesh
In addition to the contribution that the mobile sector will continue
to make towards the attainment of Vision 2021 and the SDGs, it is
important to consider how the mobile ecosystem in Bangladesh
is already a vibrant contributor to the local economy. It consists
of mobile network operators, infrastructure service providers,
retailers and distributors of mobile products and services, handset
manufacturers and mobile content, application and service providers.
In 2015, the mobile ecosystem generated 6.2% of
GDP in Bangladesh, a contribution that amounted
to around $13 billion of economic value added. This
figure includes the direct economic impact of mobile
operators and the broader ecosystem as well as the
indirect impact and the productivity increase brought
about by the use of mobile technologies.
Source: GSMA Intelligence
Total contribution to GDP ($ billion, % of 2015 GDP)
3
TotalProductivityIndirectDirect
1.8%
3.8
1.4
7. 6 12.7
3.7%
6.2%
0.7%
Bangladesh as a digital society 16
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence
Sector breakdown of direct impact contribition
Furthermore, the mobile ecosystem provided
employment to more than 760,000 people in
Bangladesh (both formal and informal employment)
and made a significant contribution to the funding
of public sector activity, in excess of $2 billion in
2015. A third of the jobs were created directly in the
ecosystem, while the rest were generated indirectly in
other sectors as a result of the consumption of inputs
generated by the mobile sector. Looking ahead, total
employment is expected to grow around 9% from
780,000 to 850,000 in the period from 2016 to 2020,
largely driven by direct employment creation in the
mobile industry.
We expect that the economic contribution of the
mobile ecosystem in Bangladesh will continue to grow.
In value-added terms, we estimate that the ecosystem
will generate $17 billion by 2020. This will be driven
by a combination of productivity improvements
brought about by continued mobile internet expansion
(both in terms of coverage and uptake), as well as by
the growth in content and services, which will bring
Bangladesh closer to the development of the mobile
ecosystem in neighbouring countries.
Source: GSMA Intelligence
Outlook to 2020, value added ($ billion)
4
Distributors
and retailers
Handset
manufacturers
Infrastucture
providers
Mobile operators
Content, applications
and other services
58%
12%
1%
25%
4%
5
6%
CAGR
20202016
4.0
1.5
8.0
13.5
5.0
1.8
10.2
17.0
Direct ProductivityIndirect
Bangladesh as a digital society 17
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence
Milestones of Bangladesh mobile market
6
1996
19972004
2007
2016
2002
2005
2012
2013
1989
• Licence issued to Bangladesh
Telecom Limited (CDMA) and
Sheba Telecom
2018
• Licence issued to Telecom Malaysia
International Bangladesh and Grameenphone
• Bangladesh Telecom Limited rebranded to
Pacific Bangladesh and Citycell brand launched
• Launch of Grameenphone,
AKTEL and Sheba
• 1 million connections• Launch of state-owned
Teletalk
• Launch of Warid
2010
• Bharti Airtel acquires Warid
• AKTEL rebranded as Robi
• Oroscom acquires Sheba
Telecom. Sheba rebranded
to Banglalink
• 10 million connections
• Teletalk launches first 3G network
in Bangladesh
• Grameenphone, Robi, Banglalink and
Airtel launch 3G networks
• 100 million connections
• Spectrum auction
• 4G services launched
• Merger of Robi and Airtel creates
number two operator by number
of connections
• Introduction of biometric
SIM registration
2017
• Subscriber penetration
surpasses 50% of the
population
Bangladesh mobile market overview 18
COUNTRY OVERVIEW: BANGLADESH
2
Bangladesh mobile
market overview
Bangladesh mobile market overview 19
COUNTRY OVERVIEW: BANGLADESH
2.1 Sustained growth as mobile penetration
reaches half the population
At the end of 2017, there were 85 million unique mobile subscribers in
Bangladesh, making it the fifth largest mobile market in Asia Pacific and
ninth largest in the world.
23
With subscribers owning on average 1.7 SIM
cards, there were a total of 145 million connections in 2017, representing
connections penetration of 87%.
 BynumberofuniquesubscribersUniqueuserswhohavesubscribedtomobileservicesattheendoftheperiodexcludingMMSubscribersdierfromconnectionssuchthata
uniqueusercanhavemultipleconnections
Rapid adoption of mobile services since the turn
of the century has resulted in unique subscriber
penetration levels in Bangladesh rising from just
over 1% in 2003 to half the population at the end of
2017. This level is forecast to reach around 60% by
the end of 2025, equivalent to 107 million individuals.
While the penetration rate for adults (15+) of 71% in
mid-2017 is suggestive of a more saturated market,
the demographics of a relatively young population,
compared to more developed countries mean that,
over the next decade, there remains significant upside
for subscriber growth.
Source: GSMA Intelligence
Mobile subscriber dynamics in Bangladesh
7
0
20
40
60
80
100
120
Million
202520202015201020052000
Unique subscribers
Mobile internet
subscriber penetration
Subscriber penetration
7%
31%
5%
48%
15%
55%
30%
60%
41%
Bangladesh mobile market overview 20
COUNTRY OVERVIEW: BANGLADESH
The mobile market in Bangladesh comprises four
licensed mobile operators: Grameenphone, Robi,
Banglalink and state-owned Teletalk. There are also
three broadband wireless access (BWA) licenceholders
– Qubee, Banglalion Communications and Ollo – which
operate as broadband service providers. While mobile
virtual network operators (MVNOs) do not operate in
Bangladesh, recent reports
24
suggest the BTRC has
been assessing the feasibility of allowing them to enter
the market.
 “BTRCmayallowmobilevirtualnetworkoperatorthedailystarnetAugust
In 2016, the mobile market underwent its first major
in-country consolidation, following the merger of Robi
(Axiata) with Airtel (Bharti Airtel), which created the
second largest operator by number of connections. At
the end of 2017, Grameenphone held a 46% share of
total connections, followed by Robi (28%), Banglalink
(23%) and Teletalk (3%). CDMA-based Citycell (Pacific
Bangladesh) has eectively been closed since Q4 2016;
the BTRC suspended its operating licence due to non-
payment of dues.
Source: GSMA Intelligence
Share of connections (including cellular IoT) by mobile operator
Note: Citycell closed Q4 2016, Airtel merged Q4 2016
The total number of mobile connections declined in
2016, by 5% to 127 million, largely as a result of the
introduction of mandatory biometric SIM registration
by the BTRC and the government, before returning to
growth in 2017 – up 14% to 145 million. The programme
initially started with a test and trial phase in late 2015
before being made mandatory from 1 January 2016,
with all new registrations verified against the National
Identity register (NID). As part of this initiative,
operators were also required to re-register their
existing subscriber base. While compliance with the
SIM re-registration was a significant undertaking for
both businesses and consumers, SIM registration can
help support the development of a digital society;
for example, it can be used to help establish a legal
identity or provide access to various government or
other value-added services.
8
20172010
46%
18%
28%
28%
23%
3%
6%
44%
Grameenphone
(Telenor)
Banglalink
(VEON, Global Telecom)
Robi
(Axiata)
Teletalk
Airtel
(Bharti Airtel)
Citycell
(Pacific Bangladesh)
Bangladesh mobile market overview 21
COUNTRY OVERVIEW: BANGLADESH
2.2 Focus shifts to mobile broadband adoption
Bangladesh has a nascent digital industry, with a predominantly prepaid
and 2G mobile market. At the end of 2017, just over 71% of connections
were 2G, with 3G comprising the remainder. Thus, only around one-in-five
Bangladeshis subscribed to mobile internet services in 2017. The country
therefore has one of the lowest levels of mobile internet penetration
among regional peers.
The majority of subscribers in Bangladesh primarily
use their phones for basic voice and SMS services,
which has implications for the attainment of the
government’s goals. As a result of this low level of
engagement, the country also generates one of the
lowest subscriber ARPU levels in the world, at $2.9,
considerably below the averages for Asia Pacific and
the world of $10.4 and $14.6 respectively, limiting the
ability of operators to engender the required transition
to mobile broadband technologies.
Source: GSMA Intelligence
Mobile penetration and subscriber ARPU in select countries, Q4 2017
The slow transition to mobile broadband technologies
(3G, 4G and eventually 5G) in Bangladesh is in part a
matter of timing: the 3G and 4G spectrum auctions
were both subject to numerous delays, taking place
in September 2013 and February 2018 respectively,
making Bangladesh one of the last countries in South
Asia to award licences for the technologies.
9
PakistanMyanmarBangladeshNepalIndiaLaosCambodiaSri LankaMalaysiaThailand
Mobile internet
subscribers
Not subscribed Subscriber ARPU
Voice only
subscriber
59%
26%
15%
41%
37%
22%
40%
32%
28%
39%
28%
34%
37%
29%
34%
29%
23%
47%
28%
24%
48%
21%
30%
49%
35%
16%
50%
21%
18%
61%
$12.8
$4.6
$5.7
$2.8
$4.7
$2.9
$3.8
$6.9
$9.3
$19.7
Percentage of population
Bangladesh mobile market overview 22
COUNTRY OVERVIEW: BANGLADESH
February 2018: Spectrum auction results
The much-awaited spectrum auctions in bands 900, 1800 and 2100 MHz concluded on 13 February 2018.
Spectrum on oer:
• 2×25 MHz in 2100 MHz band
at a reserve price of $27
million per MHz
• 2×18 MHz in 1800 MHz band
at a reserve price of $30
million per MHz
• 2×3.4 MHz in 900 MHz band
at a reserve price of $30
million per MHz
Licences sold:
Banglalink
(total cost $308 million):
• 2×5 MHz (paired) spectrum
in 2100 MHz
• 2×5.6 MHz (paired) spectrum
in 1800 MHz
Grameenphone
(total cost $155 million):
• 2×5 MHz (paired) spectrum
in 1800 MHz
Left unsold:
• 2×20 MHz (paired) spectrum
in 2100 MHz
• 2×7.4 MHz (paired) spectrum
in 1800 MHz
• 2×3.4 MHz (paired) spectrum
in 900 MHz
What else was on oer?
Conversion of existing spectrum licences to technology-neutral licences at a cost of $4 million per MHz.
Three operators chose this option (Banglalink, Grameenphone, Robi), allowing 4G services to be deployed
using their existing spectrum licences.
Key findings
Out of 2×46.4 MHz of spectrum on oer, only 33% of spectrum was sold.
Figures 10 and 11 show final price comparisons from recent international auctions.
Source: GSMA Intelligence
$/MHz/Connections (ARPU) – 1800 MHz
10
SwedenSerbiaLithuaniaSloveniaCzech
Republic
Korea,
South
TurkeyGermanyHungaryIndiaThailand
Bangladesh
0.66
0.63
0.53
0.37
0.16
0.13
0.10
0.09
0.08
0.06 0.05
0.02
Bangladesh mobile market overview 23
COUNTRY OVERVIEW: BANGLADESH
25
 ThecomparisonincludesmanydevelopedmarketsfromAsiaPacificandEuropeanregionthathaveauctionedtherespectivebandsinrecenttimes
Source: GSMA Intelligence
$/MHz/Connections (ARPU) – 2100 MHz
The final auction prices are the highest in the world, based on the normalisation of prices using ARPU for
each of the countries. This would eectively mean that mobile operators in Bangladesh have paid more
per MHz for spectrum than any other country in the world. With the challenging ARPU environment in
Bangladesh, this results in a lower return on investment for mobile operators.
11
Norway
Iceland
Canada
Slovenia
Korea,
South
Albania
Colombia
Peru
Georgia
Paraguay
Thailand
Turkey
India
Ukraine
Bangladesh
0.58
0.49
0.47
0.33
0.25
0.19
0.19
0.11
0.11
0.08
0.08
0.04
0.01
0.00
0.00
Bangladesh mobile market overview 24
COUNTRY OVERVIEW: BANGLADESH
Mobile internet penetration forecast to reach 41% by 2025, with 4G
accounting for half of total connections
 GinGin
Over the next decade, a combination of improving
aordability (driven by falling smartphone prices),
greater network coverage and technology
advances (through the launch of 4G services)
means Bangladesh’s transition to mobile broadband
technologies should accelerate out to 2025 (see
Figure 12). However, the 3G lifecycle still has a long
way to go before reaching maturity. 3G connections
are expected to surpass 2G connections in 2020,
reaching 46% of total connections – and this requires
continued investment and maintenance on behalf of
mobile operators. 4G adoption is therefore expected to
initially lag that of 3G in the years following the launch
of services,
26
but will accelerate out to 2025, at which
point 4G will represent half of total connections.
Source: GSMA Intelligence
3G and 4G adoption, years after first launch
12
87654321
0%
10%
20%
30%
40%
50%
60%
36%
30%
42%
46%
51%
29%
21%
21%
13%
13%
8%
5%
1%
6%
4G3G
Percentage of total connections
Bangladesh mobile market overview 25
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence
Bangladesh’s transition to mobile broadband technology:
closing the gap on regional peers
The number of mobile internet subscribers in
Bangladesh is forecast to reach 73 million by the end
of 2025, representing 41% of the population. However,
approximately 106 million people will remain without
access to the mobile internet, factoring in population
growth. While network coverage remains a barrier,
particularly in rural and remote areas of Bangladesh
where the costs involved in deploying and upgrading
mobile networks are substantial, coverage by itself
does not guarantee access.
Ultimately, the pace at which this digital divide will be reduced will
depend on enabling a regulatory environment that is conducive to
investment and helping to alleviate aordability barriers on the part
of consumers.
13
0.0
0.2
0.4
0.6
0.8
1.0
71%
46%
18%
65%
44%
16%
66%
38%
6%
41%
15%
28%
29%
46%
31%
18%
20%
25%
28%
38%
42%
44%
49%
60%
8%
51%
18%
35%
59%
6%
24%
52%
15%
36%
12%
202520202017202520202017202520202017202520202017
MyanmarPakistanIndiaBangladesh
2G 4G 5G3G
Percentage of connections excluding cellular IoT
Accelerating the impact of mobile on Vision 2021 and the SDGs 26
COUNTRY OVERVIEW: BANGLADESH
3
Accelerating the
impact of mobile
on Vision 2021 and
the SDGs
Accelerating the impact of mobile on Vision 2021 and the SDGs 27
COUNTRY OVERVIEW: BANGLADESH
To better understand the context of Bangladesh’s digital development
and ensure that mobile technology continues to help the country
achieve its vision of Digital Bangladesh, Vision 2021 and the SDGs, it will
be important to increase take-up of mobile services by the unconnected.
The GSMA Mobile Connectivity Index measures how the key enabling factors for mobile connectivity dier across
countries, helping focus the eorts and resources of the mobile industry, governments and wider international
community to achieve universal internet access. The index is built around four key enablers:
• infrastructure – the availability of high-performance
mobile internet network coverage
• aordability – the availability of mobile services
and devices at price points that reflect the level of
income across a national population
• consumer readiness – citizens with the awareness
and skills needed to value and use the internet, and a
cultural environment that promotes gender equality
• content – the availability of online content and
services that are accessible and relevant to the
local population.
Bangladesh has an index score of 48, which is in-line with the Southern Asia regional average, though remains low
relative to some of the more developed mobile markets in the region. Bangladesh is classified as belonging to the
‘Emerging’ cluster; it performs fairly well on one or two enablers but has room to improve in others.
Source: GSMA Intelligence
Mobile Connectivity Index – Bangladesh in relation to select Asian
countries and ‘Emerging’ cluster
Although Bangladesh has made good progress in
improving its Index score over the last two years, the
country scores below average on infrastructure and
aordability enablers relative to its regional peers.
Key barriers to mobile broadband adoption and
digital inclusion include network quality, technology-
neutral spectrum availability at aordable prices,
taxation, aordability of services (which in turn will
impact smartphone adoption), as well as other factors
including inequality and a significant gender gap.
1
Mobile
Connectivity
Index Infrastructure Aordability Consumer Content
Bangladesh 48 38 51 52 54
Southern Asia 48 41 59 48 46
Sri Lanka 61 49 72 70 56
India 49 40 63 45 49
Bhutan 46 50 65 44 32
Nepal 44 36 48 50 45
Pakistan 37 35 54 26 39
Select regional peers
Malaysia 70 60 73 71 76
Thailand 68 62 68 76 67
Cambodia 50 44 58 54 45
Myanmar 50 37 61 61 46
Laos 47 40 57 56 38
Emerging cluster 42 36 50 51 36
Accelerating the impact of mobile on Vision 2021 and the SDGs 28
COUNTRY OVERVIEW: BANGLADESH
3.1 Aordability represents a major barrier to
uptake of mobile services in Bangladesh
A higher cost of mobile access will have a greater impact on the poorest
consumers, as it constitutes a higher share of their monthly income.
 Thetotalcostofmobileownershipconsistsofthecostofahandsetactivationandusagecosts(voicedataandSMS)Itistypicallycalculatedasacostpermonthandassumes
alifeexpectancyofadeviceofmonthsformediumandlowincomecountriesandmonthsforhighandveryhighincomecountries
 ForfurtherinformationhttpbroadbandcommissionorgDocumentsITUdiscussion-paperDavospdf
 Targets“ConnectingtheOtherHalf”UNBroadbandCommission
 ReformingmobilesectortaxationinBangladeshEnhancingmobileconnectivityacrossBangladeshthroughamoreecienttaxsystemGSMA
In Bangladesh, which has a mobile market
characterised by extremely low levels of ARPU, the
total cost of mobile ownership (TCMO)
27
of a Low
consumption basket (500 MB of data) represents
4.9% of monthly income for those individuals within
the bottom 20% income group, which is just under
the aordability threshold of 5% suggested by the
UN Broadband Commission (UNBC).
28
See Figure 14.
However, at the World Economic Forum in January
2018, the UNBC adopted a new “1 for 2” aordability
threshold target for 1 GB of data to cost less than 2% of
monthly income by 2025.
29
GSMA and EY analysis
30
shows there is a clear lack
of aordability for a Medium consumption basket (1
GB of data) in Bangladesh, costing an individual in
the bottom 20% by income distribution 11.4% of their
monthly earnings. Similarly, those in the bottom 40%
would spend over 9.4% of their monthly income on
mobile ownership. Given the increased importance
of data in both social and economic settings, the lack
of aordability for a Medium consumption basket in
Bangladesh represents a significant barrier to mobile
connectivity, especially as data usage converges to
that of more developed economies in future periods.
Source: GSMA Intelligence, Tarifica
TCMO as a proportion of monthly income in Bangladesh, 2016
Note: Entry = 100 MB data only, Low = 500 MB data only, Medium = 1,000 MB data, High = 5,000 MB data
14
0.00
0.02
0.04
0.06
0.10
0.12
0.14
HighMediumLowEntryHighMediumLowEntryHighMediumLowEntry
All populationBottom 40% income groupBottom 20% income group
UN
AFFORDABILITY
TARGET OF 2%
10.6%
9.5%
4.1%
2.2%
5.7%
5.1%
2.2%
1.2%
12.8%
11.4%
4.9%
2.7%
Accelerating the impact of mobile on Vision 2021 and the SDGs 29
COUNTRY OVERVIEW: BANGLADESH
High levels of taxation and fees applied to the mobile
sector also impact the TCMO by directly raising
the retail prices faced by consumers, representing
a major barrier to the aordability of devices and
mobile services. Taxes on the use of mobile services
in Bangladesh represent a higher share of tari costs
(22%) than a number of neighbouring countries,
including India (Figure 15). Taxes also represent a
relatively high proportion (30%) of device costs
compared to in other countries in the region (Figure 16).
Source: GSMA Intelligence, Tarifica
Usage taxes as a proportion of tari costs (500 MB data basket), 2016
Source: GSMA Intelligence, Tarifica
Consumer taxes as a proportion of device costs, 2016
15
Sri LankaAfghanistanIndonesiaPhilippinesCambodiaIndiaBangladeshNepalPakistan
0%
5%
10%
15%
20%
25%
30%
0.35
Sector-specific usage tax
% of tari
General usage tax
% of tari
15%
7%
16
SingaporeThailandSri LankaCambodiaIndonesiaPhilippinesNepalIndiaLaosBangladeshMalaysiaPakistan
0%
10%
20%
30%
40%
50%
Sector-specific device taxes
% of device cost
General device taxes
% of device cost
29%
1%
Accelerating the impact of mobile on Vision 2021 and the SDGs 30
COUNTRY OVERVIEW: BANGLADESH
To better understand the barriers to mobile internet
adoption for consumers in Bangladesh, we also
analysed the results of the GSMA Intelligence
Consumer Survey.
31
As with the Mobile Connectivity
Index, cost was identified as a main issue preventing
the use of mobile internet services by Bangladeshis.
However, the aordability barrier is often due to a
limited understanding of the benefits of the internet
and a misperception around smartphone cost and
data charges. An example of an initiative to help
alleviate this has seen operators Grameenphone and
Robi partner with Facebook to launch FreeBasics in
Bangladesh, which provides access to internet services
where aordability is an issue.
 GSMAIntelligenceConsumerSurveyThissurveyincludesdatafromlow-andmiddle-incomecountriesThesurveycomprisedface-to-faceinterviewswith
approximatelypeopleineachcountry
 Thebarriershavebeengroupedintofivecategoriesaccessibility–toqualitynetworkcoverage(aswellastoelectricityhandsetsagentsandformalIDs)aordability–of
handsetstarisanddata(aswellasthecostofchargingaphonebattery)usabilityandskills–digitalskillsandconfidenceinlearningtousebasicmobilephonefunctions
internet-basedcontentandappssafety–fearsofusingmobileandtheinternetduetoegvulnerabilitytophonetheftonlineharassmentandfraudandphysicalviolence
relevance–lackofrelevantservicesandcontent
 BangladeshMobileInternetEcosystemLandscapeGSMAConnectedSociety
Nevertheless, from a consumer perspective, usability
and skills (digital skills and confidence in learning to
use basic mobile phone functions, internet-based
content and apps) are major barriers
32
too (Figure 17).
Perceptions that online content was mainly in English
contributed to the idea that the internet is for the
educated, reinforcing the idea that the internet was not
for everybody.
33
In fact, local developers have made
good progress in developing mobile content in Bengali
and other local languages, and Bangladesh has been
more successful than other South Asian countries in
developing locally relevant content, particularly over
the last few years.
Source: GSMA Intelligence
Barriers to mobile internet usage in Bangladesh
Respondents were asked to rate barriers to mobile internet adoption: 1 = not a reason/consideration; 2 = consideration but not a main
barrier; 3 = one of the main barriers
17
0.0
0.5 1.0 1.5 2.0
Safety
Relevance
Accessibility
Usability and skills
Aordability
Average scores of respondents
Accelerating the impact of mobile on Vision 2021 and the SDGs 31
COUNTRY OVERVIEW: BANGLADESH
3.2 Improving access in Bangladesh through
mobile-enabled services
Mobile continues to transform the lives of Bangladeshis. As more
people come online over the next decade, the way they engage
with mobile is changing as devices get smarter, services expand and
societies become more connected, enabling seamless interaction
between all aspects of an individual’s digital life. Beyond core
connectivity, the mobile industry in Bangladesh can provide services
that are vital to the progress of a digital society.
Mobile financial services
 UnstructuredSupplementaryServiceData
Mobile money continues to enable financial inclusion,
giving people access to transparent digital transactions
and expanding access to unbanked households. In
Bangladesh, MFS initiatives have been live since 2011,
via a model where a bank is required to hold the licence.
While MFS has seen early success in Bangladesh,
through providers such as bKash (which has more
than 80% market share), the majority of all payments
carried out in Bangladesh are still made in cash; there is
significant potential to increase MFS reach.
According to Intermedia Financial Inclusion Insights,
more than half the adult population in Bangladesh
– approximately 65 million people – has access to a
mobile phone but remains unbanked (see Figure 18).
These can be eciently reached by MFS providers.
There are opportunities to digitise more payment
streams such as person-to-government payments, as
being pursued through the government’s a2i initiative.
Source: GSMA Intelligence based on Intermedia Financial Inclusion Insights
Mobile financial services opportunity
To date, mobile network operators are not permitted
to oer a full mobile money service in Bangladesh.
They have predominantly worked in partnership with
banks, focusing on the provision of the channel: both
digital (USSD
34
access) and physical, with a supporting
agent network – as well as oering over-the-counter
(OTC) bill pay services.
18
0
20
40
60
80
100
120
Total adult
population
No mobile access,
bank account
No mobile access,
unbanked
Mobile access,
only bank account
Mobile access,
mobile money user
Mobile access,
unbanked
Million
Accelerating the impact of mobile on Vision 2021 and the SDGs 32
COUNTRY OVERVIEW: BANGLADESH
To accelerate growth of MFS in Bangladesh, it is
important to improve the regulatory environment,
which will have a positive impact on competition in
the MFS market. Allowing operators to own the full
mobile money business, including providing customer
accounts, can help Bangladesh meet its financial
inclusion goals, and its targets to digitise a broad set of
payments such as government-to-person (G2P).
Globally operators have proven they can address
the needs of the unbanked or the underbanked by
building a sustainable business over time that is
complementary to their core business. Recent large-
scale quantitative analysis by the GSMA
35
shows that
 SuccessfactorsformobilemoneyservicesAquantitativeassessmentofsuccessfactorsGSMA
 MarketsizeandopportunityindigitisingpaymentsinagriculturalvaluechainsGSMAIntelligence
operator-led mobile money deployments have been
more successful in developing and delivering digital
financial services than non-operator initiatives:
• In terms of active account growth: operators reach
an average of almost 45,000 active accounts
within a year of launch – 60% higher than for non-
operators. By the fifth year of launch, the dierence
grows to almost four-fold. In Bangladesh, there is
still room to unleash this potential.
• In terms of transaction value: by year 5, operator-led
services on average have a mobile money transaction
value equivalent to 15.6% of a country’s money
supply, compared to 1.4% for non-operator services.
Mobile agriculture services
In the coming years, food insecurity and inadequate
nutrition will be key challenges for Bangladesh,
particularly given its large and growing population
and its vulnerability to environmental shocks. Food
production will need to grow fast enough to keep
up with population growth. Mobile oers a strong
opportunity to support agriculture in Bangladesh.
mAgri information services can provide access to
nutritional information and eective agricultural
practices, and connect remote communities to
digital agricultural marketplaces in order to increase
price transparency, reduce price volatility of food
commodity markets, improve price outcomes and
increase the incomes of farmers. Monitoring data
acquired by crop and weather sensors can also be
used to increase harvest productivity and adapt to
climate change.
Alongside mAgri information services, the agricultural
sector presents an opportunity to drive the adoption
of MFS beyond urban areas and into rural and remote
regions of Bangladesh. According to a study by GSMA
Intelligence and GSMA mAgri,
36
on the condition that
mobile money providers in Bangladesh benefit from an
enabling environment (which would currently require
further regulatory reform), the potential direct revenue
opportunity for mobile money providers to digitise
business-to-person (B2P), cash-based transactions
through mobile money services is estimated at $36
million in 2016, rising to $57 million in 2020.
Source: GSMA Intelligence
Potential direct B2P revenue opportunity in Bangladesh ($ million)
19
36.28
40.95
45.92
51.20
56.70
20202019201820172016
Accelerating the impact of mobile on Vision 2021 and the SDGs 33
COUNTRY OVERVIEW: BANGLADESH
37
 Foranin-depthcasestudyonGrameenphone’sKrishiShebaseeGrameenphoneKrishiShebaAmobileagricultureserviceinBangladeshGSMA
AfullstudyofthesixservicessupportedbytheGSMAmAgriprogrammeunderthemNutritioninitiativeisavailableathttpswwwgsmacommobilefordevelopment
programmesmagricreating-scalable-mobile-solutions
Case studies of mAgri services
Banglalink Krishi Jigyasha 7676
This is an agriculture information service that
provides information related to vegetable and fruit
farming, poultry, livestock and fisheries. Users
dial 7676 to talk to an expert for advice on their
problems. At present, the service can help address
issues in areas such as harvests, pesticides, agro
diseases, seeds, fertilisers, poultry and livestock
feed, and fisheries techniques. The service has
been helping farmers in Bangladesh since 2009.
a2i agricultural initiatives
a2i, using its Service Innovation Fund, has
enabled public servants and private innovators
to devise mobile-based solutions to address the
needs of farmers, including production planning,
input application, plant disease identification
and protection. The Department of Agricultural
Extension has already made three such innovations
(Krishoker Janala, Krishoker Digital Thikana and
Pesticide Prescriber) available to more than 15,000
field-level agricultural extension ocers and
around 200,000 farmers, with potential to reach
another 15 million farmers.
To maximise the impact of such innovations, a2i is
now working with the government to launch a portal
for all agricultural extension services (including
information, inputs and incentives) that will be
available on both mobile and web-based platforms.
The overarching objective is to empower farmers
with relevant, timely and up-to-date information that
can make farming both productive and profitable.
Grameenphone Krishi Sheba
This is an agricultural value-added service (Agri
VAS) launched in December 2015 in partnership
with VAS partner, Win Miaki and support from the
GSMA mAgri programme as part of the mNutrition
initiative. The service provides users with access to
seasonal agricultural content from planting to post-
harvest, for crops and livestock.
Robi mAgri initiatives:
Robi has two live mAgri services in Bangladesh,
Krishibarta and Krishi Radio. The services combined
reach approximately 3,000 customers per month.
Krishibarta is an interactive voice response (IVR)
and call centre based agricultural service. Robi
users can listen to pre-recorded agriculture-related
content or use the call centre to talk to agricultural
specialists. Dierent types of information are
available through this service, relating to areas such
as weather, production and cultivation techniques,
diseases and insects, plant nutrients, water usage,
prices and stock.
Krishi Radio is an IVR-based service for farmers.
Users can receive IVR and outbound dialer
(OBD) content related to Krishi Bishesh Buletin,
Chashabader Upodesh, Abohawar Khobor,
Shofol Krishok/Krishanir Shakkhatkar and Krishi
Binodon. The services provide agricultural news,
advice, weather updates, knowledge sharing and
entertainment.
Accelerating the impact of mobile on Vision 2021 and the SDGs 34
COUNTRY OVERVIEW: BANGLADESH
3.3 Falling smartphones prices will help drive
smartphone adoption to three quarters of
total connections by 2025
The gradual improvement in smartphone aordability, as well as the
rapid expansion in the availability of mobile broadband services,
has spurred adoption of smartphones in Bangladesh over the last
few years. Smartphones now account for an installed base of 45
million, representing 31% of total connections. This is expected
to reach 75% by the end of 2025. Local player Symphony Mobile
remains the largest smartphone vendor in Bangladesh, with a 30%
share of smartphone shipments in Q3 2017,
38
but is facing increasing
competition from Chinese vendors including Huawei, itel, Xiaomi and
Oppo, along with established vendors including Samsung and local
player Walton.
 “ChineseSmartphoneBrandsGrewYearonYearinBangladeshDuringQ”CounterpointResearchDecember
 StrategyAnalytics
 “GrameenphonelaunchesCobrandedaordablesmartphoneswithSymphonyanditel”GrameenphoneAugust
 “Bangladeshcompaniesrevealdeviceassemblyplans”MobileWorldLiveSeptember
Mobile operators and industry players in Bangladesh,
including domestic handset vendors, have significantly
helped lower the cost of smartphones for consumers.
The average price of a smartphone in Bangladesh has
fallen from $168 in 2012 to $130 in 2017.
39
However,
in recognition that even at this level the cost of the
handset is still unaordable for the majority of lower
income individuals, industry players are also targeting
the sub-$50 smartphone market. For example,
Grameenphone recently launched co-branded
smartphones
40
with Symphony and iTel, priced at
BDT2,900 ($35) and BDT3,100 ($37) respectively.
Recent regulatory changes in Bangladesh have seen
a reduction in the customs duty for importing mobile
parts for local manufacturing (by 36 percentage
points to 1%),
41
though there was also a doubling of
the customs duty on handset imports to 10%. Given
the tendency for domestic players to import handsets
(often from China), these changes are expected to
result in the creation of local handset manufacturing
and assembly plants, which could help further lower
the retail price for consumers. Notwithstanding these
changes, regulation on mobile handsets is still a major
issue in Bangladesh (for example, mobile operators are
unable to import or brand mobile handsets) and thus
impedes the uptake of mobile services in the country.
Accelerating the impact of mobile on Vision 2021 and the SDGs 35
COUNTRY OVERVIEW: BANGLADESH
3.4 Spectrum and tax barriers reduce
operators’ ability to invest in network
coverage and expansion
Infrastructure remains a key barrier to digital inclusion in Bangladesh,
as shown by the low rating in the Mobile Connectivity Index. From a
regulatory perspective there are two main challenges for the mobile
industry: spectrum and taxation. Notwithstanding the recent 4G
auctions (the impact of which will be reflected in next year’s Index
rating), up to now the amount of spectrum assigned to operators for
3G provision in Bangladesh – just 70 MHz – is low relative to other
markets and not technology neutral.
 Ooklatrademarksusedunderlicenseandreprintedwithpermission
The limited allocation of 3G spectrum and its price
in previous auctions has had a significant negative
impact on the quality of mobile services in Bangladesh.
The combination of a lack of 3G spectrum and that
4G services have only just launched (in February
2018) means Bangladesh has lagged neighbouring
countries in terms of average download speeds,
based on Ookla's analysis of Speedtest Intelligence
average mobile speed data from Q4 2017 (Figure
20).
42
As more Bangladeshis gain access to aordable
smartphones, from local vendors including Symphony
and Walton, this will drive data trac volumes through
greater engagement with video communications
(Skype, WhatsApp, FaceTime) and video content
applications (TV Anywhere, YouTube).
Source: GSMA, Ookla®
Mean download speeds in select Asian countries in Q4 2017 (Mbps)
20
0
5
10
15
20
BangladeshIndiaNepalMyanmarLaosPakistanThailandCambodiaBhutanMalaysiaVietnam
19.9
15.78
15.43 15.36
13.42
13.35
12.94
12.76
10.89
8.92
5.08
Accelerating the impact of mobile on Vision 2021 and the SDGs 36
COUNTRY OVERVIEW: BANGLADESH
The recent spectrum auction in the 900, 1800 and
2100 MHz bands represents an important step for the
mobile industry in Bangladesh, unlocking the potential
of 4G/LTE technology, which will help service some
of this growing demand for higher-speed, always-on
connectivity. However, network capacity constraints
will continue to intensify over time, particularly in
dense urban areas such as Dhaka, meaning more
spectrum is needed. A spectrum roadmap would bring
predictability and clarity for continued planning and
investment in networks. Network coverage is also
facing challenges, as no Digital Dividend spectrum
(700 MHz) has been released in Bangladesh to date.
Allocation of the harmonised APT band plan of 700
MHz to the mobile sector can boost connectivity, and
consequently provide socioeconomic benefits.
Digital Dividend
As countries move from analogue to digital television, some low-frequency spectrum previously used for
analogue broadcasting is freed up – the Digital Dividend. For countries that want to connect more people
to accelerate progress against the SDGs, making Digital Dividend spectrum available is key. The spectrum
is ideal for reaching more people with mobile broadband because of the better coverage capabilities,
allowing operators to provide broader, more aordable coverage, especially in rural areas where
connectivity can be a challenge. Digital Dividend spectrum also delivers benefits in urban areas, providing
improved indoor coverage as these frequencies can more easily penetrate buildings, bringing the benefits
of mobile connectivity to more people, more regularly.
In order to maximise the benefits associated with the Digital Dividend spectrum – which is vital for
supporting wide area, aordable mobile broadband services – it is essential that governments do not set
unreasonably high spectrum prices.
Prior to the 2018 spectrum auctions, spectrum
licences assigned to mobile operators in Bangladesh
were not technology neutral. Although the move
to make the recent spectrum licences technology
neutral is welcomed, charging any conversion fee
will put further pressure on an already high cost of
service provision. Allowing operators to upgrade their
services using existing spectrum licences with no
additional fee would have facilitated faster deployment
of new technologies to the benefit of the people of
Bangladesh. Moreover, the licensing process and the
multiple dierent types of taxes and licences that
mobile operators are subject to – as summarised
in Table 2 – reduces the business environment and
constrains the ability of mobile operators to invest in
the sector.
One of the other major factors impacting the
investment in the networks and aordability of
services are the spectrum reserve prices. The high
reserve prices of the February 2018 auctions created
an unrealistic predetermination of spectrum value that
resulted in poor appetite from operators to bid and
therefore limited the amount of acquired spectrum.
Moreover, the high prices served to reduce the funds
available for spectrum and network investment, which
can negatively aect the quality, speed and reach of
mobile broadband services.
While recognising that taxation and fees from
the mobile sector remain an important source of
revenue to continue financing public expenditure in
Bangladesh, taxation and fees on the mobile industry
are often levied in ways that do not account for key
investment and economic features of the industry.
This potentially creates a number of distortions that in
the medium term can act to discourage investment,
harm consumers and limit the extension of mobile
connectivity to those that remain unconnected.
Accelerating the impact of mobile on Vision 2021 and the SDGs 37
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA, EY
Key taxes on consumers and mobile operators in Bangladesh in 2016
4344454647
 Reducedtoifconvertedintopubliclytradedcompaniesbyissueofatleastofpaid-upcapitalthroughastockexchangeinBangladeshofwhichthepre-initialpublic
oeringplacementshouldnotbemorethan
 Ratedependsonthedutiabletransaction
 Taxongrossreceiptsofthebusiness
 SpectrumchargesarecalculatedusingaformulasetbytheBTRC
 OperatorshallsharerevenueofinternationalincomingandoutgoingphonecallsInternationalincomingandoutgoingcallterminationratesshallbedeterminedandreviewed
fromtimetotimebytheCommissionSourceBTRC
 ReformingmobilesectortaxationinBangladeshEnhancingmobileconnectivityacrossBangladeshthroughamoreecienttaxsystemGSMA
In 2014, the total tax contribution of the mobile
sector was an estimated $1.36 billion, representing
around 46% of the sector’s total market revenue
and accounting for 7.2% of the total tax revenues of
Bangladesh.
48
Mobile operators pay 70% of the total
taxes, with consumers the remainder (Figure 21). The
mobile sector also made a large contribution in taxes
and fees relative to its size in the economy in 2014: tax
and fee payments from the sector, as a share of total
tax revenues, were 4.5 times greater than the sector’s
revenue as a share of GDP.
2
Consumers Mobile operators
Customs duty Handsets: 10%
Sim cards: 25%
Central taxes Corporation tax 45%
42
Personal income tax
(on wages)
30% (top rate)
Value-added tax (VAT) 15% Minimum corporation tax 0.75%
Supplementary duty on
SIM cards
35% Stamp duty 0.07–4%
43
Additional supplementary
duty on mobile services
5% Workers profit
participation
5%
44
Surcharge on mobile
services
1% Real-estate tax
(industrial land)
BDT125 per
decimal of land
Regulatory fees Unıversal service fund 1% of annual gross
revenue
Licence application fee BDT100,000
Radio communications
equipment licence
BDT50,000
Application fee for the
spectrum
BDT50,000
Spectrum assignment fee BDT150,000,000
per MHz
Annual licence fee BDT75,000,000
Annual spectrum fees Dierent sums
45
Revenue sharing
(Commission)
5.5% of annual
gross revenue
Revenue sharing of
international phone calls
30% of the retail
tari less the
carrier charge
46
Licence renewal fee BDT10,000,000
Accelerating the impact of mobile on Vision 2021 and the SDGs 38
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence, EY Analysis and operator data
Operator vs consumer taxes (as a share of total mobile revenue)
 SupportingtheDevelopmentofMoreEectiveTaxSystemsAReporttotheG-DevelopmentWorkingGroupbytheIMFOECDUNandWorldBank
Mobile operators in Bangladesh face a number of
sector-specific taxes and fees that are either exclusive
to the mobile industry or applied at higher rates
than other sectors in the economy. For example,
mobile operators are subject to the highest rates of
corporation tax of 40% and 45% (for publicy traded
companies and non-publicy traded companies
respectively). They are also subject to a number
of dierent regulatory fees; for example, the gross
revenue sharing fee with the Commission is 5.5% and
the Social Obligation Fund revenue rate is 1%.
Taxation over and above that applied to other standard
goods and services is not fully aligned with the
best-practice principles of taxation, which have been
developed by international organisations such as the
IMF, OECD, UN and World Bank.
49
Furthermore, high
levels of taxation and spectrum prices can have a
significant negative impact on the incentive for mobile
operators to invest in network infrastructure, and could
have long-term implications for network coverage and
mobile broadband expansion.
21
ThailandMalaysiaIndonesiaSri LankaBangladeshIndiaPakistan
0%
10%
20%
30%
40%
50%
32%
14%
Consumer taxes and feesOperator taxes and fees
Accelerating the impact of mobile on Vision 2021 and the SDGs 39
COUNTRY OVERVIEW: BANGLADESH
Source: GSMA Intelligence, EY Analysis and operator data
General taxes and fees vs mobile sector-specific taxes and fees
(as percentage of mobile sector revenue)
Regulatory fees and payments imposed on the
mobile sector can represent a high burden and can
vary substantially and unexpectedly from one year
to another, adding uncertainty for market players.
The high upfront investment required for mobile
infrastructure and long repayment cycle present
a number of risks to operators: in particular, once
investment has been made, any unfavourable changes
in policies, taxation and regulatory fees can impact
directly on profitability, lowering returns.
If taxes or regulatory fees are introduced or increased
after an auction or during a licence period, these
will negatively impact the operator business case,
aect the rollout of network infrastructure and can
have adverse eects on consumers. It also risks
further exacerbating the rural coverage gap for
the unconnected, as it is investment with the least
immediate return – i.e. in rural areas – that is likely to
be curtailed.
22
ThailandMalaysiaIndonesiaSri LankaBangladeshIndia
0%
10%
20%
30%
40%
50%
21%
25%
SpecificGeneral
Accelerating the impact of mobile on Vision 2021 and the SDGs 40
COUNTRY OVERVIEW: BANGLADESH
3.5 Tax reform can facilitate greater investment
and improve aordability
As Bangladesh progresses to a more advanced digital society,
promoting and extending connectivity has the potential to deliver
substantial social and economic benefits to the country.
 ReformingmobilesectortaxationinBangladeshEnhancingmobileconnectivityacrossBangladeshthroughamoreecienttaxsystemGSMA
The development of ICT technologies and access
to mobile broadband are also core to achieving the
objectives of Vision 2021 and the SDGs. Through
policy reform, the government of Bangladesh has the
opportunity to simplify and rebalance mobile sector
taxation, supporting the growth of the economy and
leading to increased digital and financial inclusion.
On this basis, a study undertaken by the GSMA
and EY in 2018
50
identified three options for tax
reform that would increase investment in the mobile
sector, improve the aordability of mobile products
and services, and therefore deliver substantial
socioeconomic benefits as summarised in Table 3.
ource: GSMA, EY
Summary of socioeconomic benefits of the proposed tax reforms,
by 2023
3
Indicator
Reducing corporation tax from
45% to 40% for private mobile
operators and from 40% to 35%
for public mobile operators
Eliminating the supplementary
duty of 35% applied on the
supply of SIM cards and VAT of
15% on SIM cards
Eliminating the 5%
supplementary duty
levied on mobile
services
New unique
subscribers
+0.5m +2.3m +3.2m
Sector revenue +$42m +$75m +$82m
GDP increase +$131m +$535m +$749m
Wider
investment
+$180m +$468m +$687m
Annual gain in
tax revenue
+$14m +$123m +$135m
Accelerating the impact of mobile on Vision 2021 and the SDGs 41
COUNTRY OVERVIEW: BANGLADESH
3.6 Allowing all types of network infrastructure
sharing can increase accessibility and help
close the coverage gap
Source: GSMA Intelligence
Mobile operators in Bangladesh have invested heavily to enable
broadband adoption
 Passiveandbackhaulsharing–sharingofthe‘passive’non-electronicinfrastructure(suchasthecellsitestowerspolesductstrayssheltersequipmentroomspower
securityetc)andthebackhaultransmissionfromthecellsitetothecorenetwork(bymicrowavesatellitefibre-opticcableoracombinationthereof)
 Activesharing–MORAN(multi-operatorRAN)–sharingofthe‘active’(ieelectronic)infrastructureintheradioaccessnetwork(RAN)includingtheBTSBSC(G)NodeB
RNC(G)andtheantennas(andassociatedfeederscombinersetc)MOCN(multi-operatorcorenetwork)–thesameasMORANbutthespectrumisalsoshared
With capex totalling more than $3.4 billion over the
last five years, including $525 million on spectrum
acquisitions in 2013/14, mobile network access has
expanded rapidly in Bangladesh. 2G networks have
achieved nationwide coverage and 3G coverage has
expanded to reach 93% of the population by the
end of 2017. Significantly, however, in 2017, 72% of
the population or more than 118 million people were
covered by a mobile broadband network but did not
subscribe. These people are more likely to be in lower
income groups, for whom aordability is a key barrier.
Furthermore, rolling out mobile broadband coverage
in hard-to-reach rural and remote areas may require
innovative solutions such as network sharing. There
are many forms and combinations of mobile network
infrastructure sharing and, up to now in Bangladesh,
this has predominantly been conducted in the form
of passive and backhaul sharing.
51
Active sharing
(MORAN or MOCN),
52
however, is not currently
permitted by the regulator, though discussions are
ongoing about possible pilot schemes, which can look
to bridge mobile broadband coverage gaps for the
underserved.
The potential benefits of active sharing to the
economy and people of Bangladesh are significant.
For example, a study conducted in 2017 by the GSMA
Connected Society programme – assessing the
impact of expanding mobile broadband coverage in
Bangladesh to 100% of the population – found that
implementation of active sharing between the three
23
0.00
0.25
0.50
0.75
1.00
20172016201520142013201220112010
Capex/revenueCapex ($ billion)
$0.5
27%
38%
$0.8
$0.5
22%
29%
28%
25%
24%
17%
$0.7
$0.8
$0.7
$0.7
$0.5
Accelerating the impact of mobile on Vision 2021 and the SDGs 42
COUNTRY OVERVIEW: BANGLADESH
largest operators could, by 2021, increase GDP (in
nominal terms) in Bangladesh by more than $3 billion
per annum, representing a 0.1% yearly increase in GDP.
In this case, the government would also benefit from
additional fiscal income of more than $300 million per
annum from 2021 onwards.
As operators gear up to launch 4G services, there is
a significant opportunity for the BTRC, the Telecom
Ministry and stakeholders, including mobile operators,
to collaborate and prove the concept of network
sharing. The benefits of doing so can be substantial.
Benefits for the government and regulator:
• Address coverage and social inclusion issues in
priority rural locations
• Explore application of policy considerations for
mobile broadband rural expansion
• Demonstrate benefits to government of introducing
a more favourable regulatory environment on a
national basis
Benefits to the operators:
• Demonstrate further commitment from operators
to supporting a Digital Bangladesh
• Allow operators to explore alternative investment,
revenue and technology models
• Explore viability of infrastructure sharing in driving
forward rural broadband expansion
Accelerating the impact of mobile on Vision 2021 and the SDGs 43
COUNTRY OVERVIEW: BANGLADESH
A forward-looking regulatory environment  44
COUNTRY OVERVIEW: BANGLADESH
4
A forward-looking
regulatory environment
A forward-looking regulatory environment  45
COUNTRY OVERVIEW: BANGLADESH
Mobile industry dynamics in Bangladesh have changed significantly
over the last decade, through the convergence of technologies, the
emergence of new digital services and increased competition from
internet and digital ecosystem players. These shifting dynamics
have created a challenging investment climate for mobile operators,
who are faced with funding the underlying network infrastructure to
accommodate growth in digital services.
In addition, despite the rapid uptake of mobile
in Bangladesh in recent years, around half of the
population remain without access to mobile services
and, further still, only one-fifth of the population
subscribe to mobile internet services. Through review,
reform and modernisation of regulation in key areas,
policymakers and the regulator in Bangladesh can
play a major role in facilitating the expansion of mobile
broadband access and adoption across the country,
supporting progress towards achievement of Vision
2021 and the SDGs.
A long-term roadmap for spectrum at aordable prices is required
With the recent spectrum auction, Bangladesh
policymakers made important steps towards
introducing 4G/LTE services in the country, in support
of Digital Bangladesh. The release of technology-
neutral licences and spectrum in the 900, 1800 and
2100 MHz bands is a significant development for the
country’s mobile industry. However, even after an open
consultation process with stakeholders, high auction
reserve prices and associated licence fees remained.
When coupled with some of the lowest ARPU levels
in the world in Bangladesh, some of this high-priced
spectrum went unsold.
The experience with this auction highlights the
importance of setting reserve prices for future
spectrum auctions at levels that take into account
that operators need to not only finance access to
spectrum, but also to deploy infrastructure to use
that spectrum. This will become even more important
as mobile broadband adoption scales and increased
data demand further strains networks, requiring
even greater access to spectrum. Without sucient
spectrum, quality of service for the end customer
will suer, impeding the use of digital services. The
government should therefore ensure both the timely
release of spectrum and fair prices for access to
that spectrum to facilitate better quality and more
aordable services.
It is also vital that the government creates a
predictable spectrum roadmap for future assignments
of spectrum (e.g. 700 MHz), helping to create a stable
and transparent investment environment, which takes
into account the long lead time required for network
rollout and expansion. As part of this, harmonisation at
the ITU level is a crucial requirement. The government
should consult on spectrum planning well ahead of
the World Radiocommunication Conference (WRC) in
November 2019 and support regional harmonisation at
the conference.
Rebalance taxation in line with best-practice principles to improve
aordability and foster investment
As the Bangladesh mobile sector continues to develop,
the focus should turn to encouraging an environment
that is conducive to investment. Reforming taxation
applied on the mobile sector towards a more
balanced and ecient structure, in line with principles
established by international organisations such as
the IMF, World Bank, OECD and UN, has the potential
to provide significant economic and social benefits.
Reducing the complexity and uncertainty of taxes
and fees on the mobile sector will also improve
A forward-looking regulatory environment  46
COUNTRY OVERVIEW: BANGLADESH
predictability and business confidence. Tax rules
should be clear and simple to understand, so that
taxpayers can anticipate the tax consequences in
advance of a transaction. Abolishing inconsistent
applications of tax rules will provide a better
investment climate. Section 3.5 sets out three options
for reform that would address some of the most
distortive taxes on the mobile economy in Bangladesh.
These can increase aordability of mobile products
and services, by lowering the tax burden on consumers
and mobile operators, and can add further value to the
economy through productivity gains and the knock-on
impact on other industries.
Allow all types of network sharing to facilitate mobile broadband expansion
Infrastructure remains a major barrier to providing
rural coverage in Bangladesh. In recognition of
the need to find solutions that are commercially
sustainable, network sharing oers a great
opportunity to help bring mobile internet services
to all Bangladeshis. Though the country has started
to see benefits from passive infrastructure sharing,
it is imperative that the government allow all types
of network infrastructure sharing including MORAN,
MOCN and roaming. As part of this, infrastructure
sharing should remain optional for mobile operators;
forcing them to share infrastructure creates a
disincentive to deploy new infrastructure and may
negatively aect investment and coverage.
Rationalise licensing regime to support quality of service for the
consumer and improve the investment climate
The current licensing regime in Bangladesh is
highly fragmented and complex. On a number
of occasions, the government has introduced
policies and regulations that have brought in new
licensees/entities into the service delivery value
chain (i.e. operators of Bangladesh’s Nationwide
Telecommunication Transmission Network) that are
not subject to the same quality of service obligations
as mobile operators, resulting in ineciencies that
negatively impact on the end user experience and
raise compliance costs for mobile operators. The
government should seek to rationalise the licensing
regime and reduce the unpredictable licensing
changes in order to improve business confidence,
reduce costs, facilitate network investment and thus
improve the overall experience for mobile users.
Reform regulation to realise the full potential of mobile financial services
As the take-up of mobile broadband and smartphone
adoption continues, emerging services including
mobile financial services and mobile money
applications can help accelerate productivity and
financial inclusion throughout the economy. Despite
the improvement in financial access in Bangladesh,
there remains a lack of competition and cooperation
in the provision of MFS. It is therefore important
to improve the regulatory environment, in order to
seize the significant opportunity that MFS oers in
Bangladesh.
Globally mobile operators have proven they
can address the needs of the unbanked or the
underbanked by building a sustainable business
over time that is complementary to their core GSM
business. In order to unlock the full potential of mobile
money and develop an ecient financial sector in
Bangladesh, the government and the regulator should
create an open and level playing field that allows both
banks and non-bank providers to oer these storage
and payment services – particularly operators, which
are well suited to building sustainable services and
extending the reach of the formal financial sector.
COUNTRY OVERVIEW: BANGLADESH
gsma.com
 4
COUNTRY OVERVIEW: BANGLADESH
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