Telecoms executives are keeping faith in emerging markets despite currency gyrations amid the global economic downturn.

Executives in Barcelona at the wireless industry's leading trade show did however expect a pause in takeover activity.

Emerging market exposure has been challenged over the last half-year from an investor perspective, Telenor chief executive Jon Fredrik Baksaas told Reuters on Wednesday, adding fundamental drivers of growth were unchanged, however.

Why does India have a penetration of 30 percent when most neighboring countries are at a much higher penetration level?

For me it's quite obvious that the mobile market in India will double and that Telenor will take part in that ambition, he said.

Manoj Kohli, chief executive of India's top mobile operator Bharti Airtel, said mergers and acquisition activity would likely remain slow for the time being. The values (of emerging market assets) are definitely better but the seller also has to be at the table, Kohli told Reuters.

We're looking at various markets. We're looking at all opportunities but we're not in a hurry. We definitely don't want to pay more than the asset deserves to be paid, so maybe when that opportunity comes in one year or two years we'll look.

China Mobile, the world's largest mobile phone group by subscriber numbers, struck a similarly cautious note on international expansion.


Alexander Izosimov, chief executive of Russian Vimpelcom, said the problem was not the long-term outlook, but valuation of emerging market assets.

The question is now not whether the market is attractive, but how much you are willing to pay for it and what's the fair valuation, Izosimov told Reuters.

That's where there is too much dust in the air and it needs to settle before valuation frameworks will emerge and proper assessment of risk will be priced in.

Sureyya Ciliv, chief executive of Turkey's largest mobile operator Turkcell, was unperturbed by foreign exchange volatility -- one of the countries Turkcell operates in is Belarus, which devalued its currency by 20 percent this year.

Emerging markets ... do come with their own risks, sometimes there are devaluations, but we are in these markets for the long term, Ciliv said.

Suryanarayana Valluri, vice president communications and media for IT consulting firm Wipro was less sanguine.

It is a challenge for all of us who are playing in a global economy because there is no predictability. The pound has gone down by 30, 40 percent, and the dollar that was expected to weaken, has strengthened, he said.

Valluri said groups with emerging market subsidiaries were pushing their units to fund a larger part of their operations in local currency, either through debt or equity, to minimize currency risk.

Capex is reasonably dollar or euro-linked, because that's where all the equipment vendors are, so only to that extent are you looking for external funding. For all your marketing, sales, and customer needs you look for local financing, he said.

With easy credit gone in western economies, executives such as Microsoft chief executive Steve Ballmer expected a period in which the economy resets to a lower level of spending -- and many look to emerging markets to lead the world out of the current malaise.

Jeffrey Sachs, special adviser to U.N. Secretary General Ban Ki-Moon and director of the Earth Institute, is one of them. It is the emerging markets and the developing world more generally which will likely lead the world out of this recession.

(Editing by Dan Lalor)