The problem seems to be that the modem times out responding:
<debug> [1300375162.083126] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): <-- '<CR><LF>+CIND: 1,3,1,0,1,0,1,0,0,0,0,0<CR><LF><CR><LF>OK<CR><LF>'
<debug> [1300375191.980676] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): --> 'AT+CIND?<CR>'
<debug> [1300375192.045069] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): <-- 'AT+CIND'
<debug> [1300375192.076325] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): <-- '?<CR>'
<debug> [1300375221.980631] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): --> 'AT+CIND?<CR>'
<debug> [1300375251.980717] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): --> 'AT+CIND?<CR>'
<debug> [1300375281.980735] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): --> 'AT+CIND?<CR>'
<debug> [1300375304.750596] [mm-serial-port.c:798] mm_serial_port_close(): (ttyACM0) device open count is 0 (close)
<info> [1300375304.805987] [mm-serial-port.c:811] mm_serial_port_close(): (ttyACM0) closing serial port...
<debug> [1300375304.839035] [mm-port.c:181] mm_port_set_connected(): (ttyACM0): port now disconnected
<info> [1300375304.872109] [mm-serial-port.c:834] mm_serial_port_close(): (ttyACM0) serial port closed
<debug> [1300375304.905221] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): <-- '<CR><LF>+CIND: 1,3,1,0,1,0,1,0,0,0,0,0<CR><LF><CR><LF>OK<CR><LF><CR><LF>+CIEV: 2,2<CR><LF><CR><LF>+CIEV: 2,3<CR><LF>'
<info> [1300375304.939062] [mm-modem.c:761] mm_modem_set_state(): Modem /org/freedesktop/ModemManager/Modems/0: state changed (connected -> disconnecting)
<info> [1300375304.971659] [mm-modem.c:761] mm_modem_set_state(): Modem /org/freedesktop/ModemManager/Modems/0: state changed (disconnecting -> connected)
<debug> [1300375306.610641] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): <-- '<CR><LF>+CGREG: 1,"0CEC","01345890",4<CR><LF><CR><LF>+CREG: 1,"0CEC","01345890"<CR><LF>'
<debug> [1300375307.460661] [mm-at-serial-port.c:298] debug_log(): (ttyACM1): <-- '<CR><LF>+CIEV: 2,4<CR><LF>'
<debug> [1300375307.964547] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): number => "*99#"
<debug> [1300375307.998269] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): network_mode => 0
<debug> [1300375308.080864] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): apn => "bsnlnet"
<debug> [1300375308.295288] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): allowed_mode => 0
<debug> [1300375308.328472] [mm-generic-gsm.c:4250] simple_state_machine(): (ttyACM0): simple connect state 0
<debug> [1300375308.361563] [mm-generic-gsm.c:4250] simple_state_machine(): (ttyACM0): simple connect state 2
<info> [1300375308.396454] [mm-modem.c:761] mm_modem_set_state(): Modem /org/freedesktop/ModemManager/Modems/0: state changed (connected -> disconnecting)
<info> [1300375308.427854] [mm-modem.c:761] mm_modem_set_state(): Modem /org/freedesktop/ModemManager/Modems/0: state changed (disconnecting -> connected)
<debug> [1300375312.032212] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): number => "*99#"
<debug> [1300375312.089508] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): network_mode => 0
<debug> [1300375312.122620] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): apn => "bsnlnet"
<debug> [1300375312.155723] [mm-generic-gsm.c:4361] simple_connect(): (ttyACM0): allowed_mode => 0
<debug> [1300375312.188811] [mm-generic-gsm.c:4250] simple_state_machine(): (ttyACM0): simple connect state 0
<debug> [1300375312.221950] [mm-generic-gsm.c:4250] simple_state_machine(): (ttyACM0): simple connect state 2

Please make sure that you're getting decent signal levels. You might also want to test it with a different USB port if it's connected over USB -- like not using a USB hub, or making sure you use the special cable that comes with it for more power, if that devices requires it.

Unfortunately, no way to tell what's wrong for now, marking this bug Incomplete.