The $500m, 15-year-licence is an audacious bet that the generals who have ruled the South Asian country since seizing power in 1962 will continue a process of gradual liberalisation.
“The people of Myanmar are ready for world-class mobile services and Telenor is ready to deliver it,” Jon Fredrik Baksaas, President and CEO of Telenor Group, said after signing the deal on Thursday.
"This is the start of an exciting journey in Myanmar’s development, which Telenor will support through the delivery of world-class mobile services, responsible business practices and high standards that we live by in all of our markets."
Less than 10 percent of the country's 60m people currently have mobile phones, making it one of the world's last untapped telecoms markets.
Telenor aims to spend a further $500m building a state-of-the-art 2G and 3G network which will bring mobile coverage to 90 percent of the country's population within five years.
Story continues below…
It aims to hire 1,000 new employees in the country by the end of 2014. Currently, the company has a workforce of 150.
Telenor already operates in neighbouring India, Thailand and Bangladesh.