"The initial investment proposal is 150 million dollars and we plan to cover the entire country (with the service)," Gupta said following the signing of the BOI documents.

The firm, having mobile, broadband and telephone and enterprise services, hopes to use infrastructure of the other telecom companies to gain coverage in the country.

Gupta said the firm has already received regulatory approval to offer second and third generation (2G and 3G) services.

3G has higher bandwith than 2G allowing users to browse the internet on their phones and watch video and listen to radio compared with the older 2G technology that is more text-based and only offers still images.

Sri Lanka's telecommunications sector has been growing rapidly with the help of advanced technology, competition, higher investment, affordability and rapid expansion of network coverage.

The overall subscriber network for the telecommunication sector grew by 59 percent in 2006. The fixed access subscriber network grew by 52 percent from the expansion in wireless networks while the mobile telephone services subscriber network grew by 61 percent.

But the Tamil Tiger conflict has delayed telecom development and expansion plans in the northern and eastern areas of the country.

Gupta says the firm also hopes to expand its services in to conflict areas in the country.

Airtel made more than one billion dollars in profit last year on over four billion dollars in turnover.

The firm has around 40,000 base stations in India with 2,500 being rolled out each month.

Airtel is subsidiary of Bharti Enterprises which has interests in telecom services, equipment manufacture and export, agricultural exports and retail shopping stores.