Emerging from three decades of conflict and instability in 2002, Afghanistan barely had a functioning communications network. Services were available to less than one percent of the country’s population. The Ministry of Communications operated services in just five major cities, with more than 60 percent of the 57,000 functioning lines in a single city, the capital Kabul. Moreover, the country had little or no access to the Internet. Given the state of communications infrastructure, the Government’s ability to govern was severely limited.
The IDA-financed Emergency Communications Development Project was launched in 2003 to improve delivery of communications services to the Government and people of Afghanistan. It aimed to: expand the government communications network, restore critical communications between ministries and provinces, and provide urgently needed policy advice to the Ministry of Communications.
Unprecedented progress revitalized the country’s communications. Telephone access increased from less than 1 percent to 32 percent of the population. The number of fixed and mobile telecommunication subscribers increased from 57,000 in 2002 to almost 10 million in 2009, while costs have plummeted by 95 percent—from $2/min to $0.10/min.
Highlights:
- Government communications expanded. All provinces were connected on the Government Communications Network, enabling voice and data transfer, and videoconferencing between Kabul and the provincial capitals.
- Sector revenue and employment grew exponentially. The telecommunications sector now contributes an estimated $75 million to government revenues and directly or indirectly employs more than 60,000 people.
- Infrastructure built. An Earth Satellite Station at Mahtab-Qala was installed on the outskirts of Kabul. A new radio spectrum monitoring system became operational.
- Competition blossomed. From a single operator in 2002, Afghanistan’s competitive telecommunications market grew to encompass five private mobile operators, a unified service provider, and six operational Internet service providers.
- Prices became accessible for the typical Afghan. Prices for mobile telephony have dropped considerably, making services more affordable for more Afghan people. In 2002, it cost about US$400 to purchase a mobile phone and US$2 for every minute of talk time. Today, an Afghan can purchase a mobile phone for less than US$50 and spends less than 10 cents per minute of talk time. Moreover, an agreement with Pakistan to route calls overland has lowered costs and increased traffic, and
- Reform advanced. Afghan Telecom has been corporatized and a separate regulatory agency established.
The total project cost was financed by a US$22 million IDA credit. An additional US$6.1 million came from the Afghanistan Reconstruction Trust Fund. IDA support was catalytic in establishing a sound policy, legal, and regulatory framework for a sector that is experiencing considerable private-sector investment—up to $1 billion by some measures. IDA leveraged the World Bank Group’s experience in scaling up private wireless operators in post-conflict environments.
The telecommunications sector is dynamic and growing in Afghanistan, and benefits from the cooperation of the Afghanistan Reconstruction Trust Fund and more than 30 international partners.
Despite impressive developments, gaps remain. There has been explosive growth in telephony services, but much work remains to be done to develop Internet services. Similarly, while the country has developed considerable urban connectivity, much work is required to extend these gains further into rural and remote areas.
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