China Mobile, the world’s largest mobile phone carrier, announced today that its first-quarter profits are up 37%. China has the largest population of mobile users, with around 520 million accounts. The government of China predicts that this number will increase to 600 million in the near future.

“The rapid growth in China’s economy and the vigorous demand for telecommunications services continued to create a prosperous environment,” said a China Mobile statement.

China Mobile posted a profit of 24.1 billion yuan ($3.4 billion) in the first-quarter that ended on March 31. Subscriptions rose 6% for a total of 392 million. New accounts accelerated by 33% to 7.6 million per month in the quarter, driven mostly by new business in rural China. China’s eastern cities are near the saturation point, so the company is targeting the countryside.

It is believed that the government is about to approve licenses for third-generation (3G) technology. 3G supports mobile video, Web access and other services. This is expected to increase revenues even more as mobile carriers can offer new profitable services to customers.