OAO Mobile TeleSystems (MBT), Russia’s largest wireless carrier, plans to increase dividends this year and next as demand for wireless data boosts earnings.

MTS will pay a total of 90 billion rubles ($2.5 billion) during 2014 and 2015, Chief Executive Officer Andrei Dubovskov told reporters today in Moscow. The carrier’s previous dividend target was 40 billion rubles a year.

MTS, controlled by billionaire Vladimir Evtushenkov, is adding subscribers by offering cheaper smartphones and contracts bundling Internet service and voice. Demand for wireless Web-surfing is helping to offset slowing voice revenue.

The company, which paid 41 billion rubles in dividends last year, will boost shareholder rewards because of “higher cash flows and strong operating results,” Dubovskov said.

MTS links its dividend to free cash flow, which increased by a third last year to more than 60 billion rubles, the company said. Operating income before depreciation and amortization rose 6.5 percent last year to 170 billion rubles, the company said, citing preliminary figures. Sales will grow 3 percent to 5 percent annually through 2016 after advancing about 5 percent last year, MTS said.

The carrier, which competes with billionaire Alisher Usmanov’s OAO MegaFon (MFON) and Mikhail Fridman’s VimpelCom Ltd. (VIP), plans 260 billion rubles of capital spending over three years to expand its mobile-data networks in Russia and former-Soviet republics. The Russian mobile-data market will grow 16 percent a year through 2016, while mobile-voice market may fall 1 percent a year, MTS projected.

MTS shares rose 1.6 percent to 293.51 rubles at 12:53 p.m. in Moscow. They had lost 12 percent this year through yesterday amid a slowing Russian economy. VimpelCom has fallen 27 percent in U.S. trading and MegaFon has dropped 10 percent in London.

MTS’s strategy doesn’t imply that the company will buy MTS India from its parent AFK Sistema (SSA), Dubovskov said. The company also has been largely unaffected by the emergence of a new countrywide operator based on the mobile assets of state-run OAO Rostelecom and Tele2 Russia, he said.