DEG: 50 million US-dollars for mobile communications and finance sector in South Asia

• 30 million US-dollars for mobile communications infrastructure in India
• 20 million US-dollars for SME financing in Bangladesh

In India, there are 73 mobile telephone contracts per 100 inhabitants. In comparison, the quota is 80 percent in China, 97 percent in Thailand and as much as 130 percent in Germany. In order to contribute to improved access to communications services in India, DEG - Deutsche Investitions- und Entwicklungsgesellschaft mbH, has provided a long-term loan to the amount of 30 million US-dollars to the Indian company Viom Neworks Ltd.. "Viom sets the benchmark for India's infrastructure development. Our commitment will enable the company to create a modern communication infrastructure also in sparsely populated areas," said Dr Michael Bornmann, member of DEG's Management Board, on the occasion of the signing of the contract in New Delhi on 17 January 2012. The event was part of the Year of Germany in India (60 years of Indo-German diplomatic ties) and took place in presence of the German Embassy.

Up to now Viom has set up 37,338 mobile phone towers which it rents out to mobile phone operators. The company will invest the DEG loan to set up further towers and upgrade existing towers, mainly in semi-urban and rural areas which so far lack the access to mobile networks. This will lead to an improved utilisation of available resources, cost savings for the operators and the prevention of double investments. Given that the towers can be used by several mobile telephone operators, it is worthwhile covering remote areas as well. As a consequence, also people in rural areas of India will get access to telecommunications services.

DEG has also committed a finance sector investment in South Asia: It provides a long-term loan to the amount of 20 million US-dollars to Eastern Bank Ltd (EBL), a commercial bank in Bangladesh. EBL offers a wide range of financial services in the corporate and retail business, with a particular focus on the financing of small and medium-sized enterprises (SMEs).

SMEs are a major engine behind economic growth, particularly in developing countries. This is why the promotion of these enterprises is a matter of particular concern to DEG. "With our commitment, we enable Eastern Bank to continue pursuing its course of growth and to further expand its financial offer. At the same time, we are fostering the Bangladeshi financial sector, facilitating the access to long-term investment capital especially for small and medium-sized enterprises,” said Philipp Kreutz, member of DEG’s Management Board, on the occasion of the signing ceremony in Dhaka on 16 January 2012. While EBL’s staff of over 1,200 directly contributes to local employment, about 86,000 indirect jobs are additionally secured with its customers.

DEG has been operating in Asia since the 1960s, where it advocates a sustainable promotion of private-sector structures as the engine behind development. It is represented in the important markets through five representative offices, located in Bangkok, Beijing, Jakarta, New Delhi and Singapore.