Mukesh Ambani Ventures into Africa with 5G Broadband Services in Ghana

Mukesh Ambani, Asia’s wealthiest individual and chairman of Reliance Industries Ltd., is making a significant entry into the African telecommunications market. His company, through its subsidiary Radisys Corp., has teamed up with Ghana-based Next-Gen InfraCo (NGIC) to introduce 5G broadband services in Ghana. This move is poised to revolutionize digital connectivity in the region, leveraging Ambani’s successful telecom model from India.

Strategic Partnerships and Technological Backbone

NGIC, which plans to start operations by the end of the year, aims to provide affordable digital services by collaborating with several technological giants. Notable partners include:

• Nokia Oyj: Providing advanced networking solutions.
• Tech Mahindra Ltd.: Offering IT services and solutions.
• Microsoft Corp.: Enhancing telecom operations through cloud networking capabilities.

These partnerships ensure that NGIC benefits from cutting-edge technology and robust infrastructure, essential for the successful deployment of 5G services.

Ghana’s Telecom Landscape

Ghana, a West African nation with a population exceeding 33 million, has three primary telecom operators: MTN Ghana, Telecel Ghana, and the state-operated AirtelTigo. NGIC’s entry, armed with Ghana’s sole 5G license, promises to deliver high-speed internet services at a lower cost, addressing the financial constraints of individual mobile carriers.

The Ghanaian government, recognizing the strategic importance of this venture, holds just under a 10% stake in NGIC, while two African firms, Ascend Digital Solutions Ltd. and K-NET, control a combined 55% stake. The remaining shares are distributed among local mobile operators and private investors.

Financial and Operational Projections

NGIC has exclusive rights to offer 5G services in Ghana for the next decade, with the license extending for 15 years. The projected capital expenditure for the initial three years is estimated at $145 million. This substantial investment is expected to yield significant returns by enhancing digital connectivity and fostering economic growth in Ghana.

Learning from Jio’s Success

Ambani’s blueprint for success in Ghana is heavily influenced by the phenomenal rise of Jio Infocomm Ltd. in India. Launched in late 2016, Jio revolutionized the Indian telecom market with affordable data and free voice services, forcing competitors to either consolidate or exit the market. Today, Jio boasts 470 million users, making it India’s largest mobile operator.

In Ghana, NGIC intends to replicate Jio’s success by offering affordable mobile broadband services and devices. This strategy aligns with the Ghanaian government’s vision of a digitally inclusive society, as articulated by Ursula Owusu-Ekuful, the Minister for Communications and Digitalization.

Diplomatic and Strategic Implications

The partnership between Reliance and NGIC is also a diplomatic milestone for India. It counters China’s growing influence in Africa by promoting digital inclusion and economic development. Although Reliance and other strategic partners do not currently hold equity in NGIC, there is an option for them to convert part of their payments into equity in the future, contingent on the venture’s success.