KARACHI: Cell phone manufacturing firms in Pakistan rolled out 7.6 million handsets in the first five months of the year, the country’s telecom authority has said, with top officials in manufacturing companies saying they were ready to export smartphones in the next six months.
Once the world’s seventh largest importer of mobile phones, Pakistan made local assembling of cellphones possible by implementing the Device Identification, Registration and Blocking System (DIRBS) in 2018. The system not only controlled the smuggling of mobile phones but also led to the local manufacturing of these gadgets.
According to statistics compiled by the Pakistan Telecommunications Authority (PTA), local manufacturing in 2020 stood at 12.6 million phones, including 10.42 million 2G devices and 2.22 million 3G and 4G sets.
“In the current year, about 5.34 million 2G and 2.23 million 3G/4G devices have been locally manufactured,” PTA, which keeps a record of cell phones produced in the country, said in response to an Arab News query.
“In accordance with the Mobile Device Manufacturing Regulations issued by the PTA on 28th January 2021, a total of 19 companies who applied to the PTA for setting up mobile device manufacturing plants have been approved. A 10-year Mobile Device Manufacturing (MDM) Authorization has been granted by the PTA to these companies,” the telecom regulator added.
PTA said Pakistan’s total annual market size was estimated at 34 million handsets, adding that these included 20 million 2G and 14 million 3G/4G devices.
Pakistan has 85 percent tele-density with 183 million cellular subscribers. The country also has 98 million 3G/4G and 101 million broadband subscribers.
To meet the growing market demand, 19 companies, mostly from China, have started operating in Pakistan. Other market players include Nokia, which is setting up its manufacturing unit in the country in collaboration with a local company.
“The MDM regulations allow both foreign companies as well as joint ventures between local and foreign companies to apply for manufacturing authorization,” the PTA said, adding: “The companies who have been issued authorization include both standalone foreign entities and joint venture companies who have partnered with a foreign brand to set up mobile manufacturing plants in Pakistan.”
The prominent brands, according to the Pakistani telecom regulator, include Oppo, Realme, Vivo, Alcatel, Infinix, Techno and Nokia etc.
After the implementation of DIRBS, many foreign cell phone manufacturers felt the need for local production, say industrial players.
“It is a matter of survival,” Aamir Allawala, CEO of Tecno Pack Telecom, told Arab News. “In the coming days, all brands will have to ensure manufacturing in Pakistan. If anyone fails to do that, it will not be able to survive in the local market.”
Manufacturers say they are meeting about 60 percent demand of mobile phones through local production which is likely to increase to 70 percent by August this year.
The companies are also optimistic to start exporting smartphones within a span of six months.
“The government had announced a three percent export rebate in its policy, but it has still not been implemented,” Allawala said, adding: “We expect that this will be implemented in the upcoming budget since export will become viable once the rebate is introduced.”
“With requisite incentives, Pakistan will start exporting mobile phones within six months,” he said. “We have a labor cost advantage since assembling rate is significantly lower in Pakistan. In China, for instance, the labor cost stands at $700 while in Pakistan it is around $125.”
The Mobile Device Manufacturing Policy 2020 also predicts that in the next two to three years, local production can reach up to 80 percent of Pakistan’s total handset market demand if attractive tariff plans are offered to the industry.
“This can result in the creation of at least 40,000 high-skill direct jobs in electronics and information technology industry and up to 300,000 indirect jobs in ancillary sectors,” the policy document reads. “A typical smartphone constitutes more than 60 parts, and its assembly requires manpower, where Pakistan can benefit from its low labor cost.”
Cellphone manufacturers in the local market say Pakistan has acquired the capability to produce all types of phones and is ready to manufacture 5G handsets when the network is rolled out by the end of the next year.
“The 5G network is not available in Pakistan at the moment, so manufacturing of 5G mobiles is out of the question for now,” Allawala said. “But when the network becomes available, the manufacturing will also start.”
Local traders say Pakistan’s domestic market was inundated with imported smartphones a few years ago, though they were now being replaced by locally assembled devices.
“A majority of phones in the market are now coming from local assembling plants,” Muhammad Rizwan Irfan, president of the Karachi Electronic Dealers’ Association, told Arab News, adding: “The quality of local mobile phones is gradually improving, but they still need to focus on after-sales service.”
According to dealers and manufacturers, the price gap between locally assembled and imported phones is somewhere between 12 and 13 percent.
Asked about the manufacturing prospects of iPhone, Samsung, Huawei and other major brands in Pakistan, the PTA responded by pointing at the country’s overall market potential.
“There is a huge appetite for the use of mobile devices locally and the government hopes it can be fulfilled through local manufacturing,” it said.
Pakistan eyes exports as local smartphone manufacturing touches 7.6 million units in 2021
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Pakistan eyes exports as local smartphone manufacturing touches 7.6 million units in 2021
- Pakistan’s telecom regulator says country manufactured 12.6 million smartphones last year though local production mainly focused on 2G handsets
- Manufacturers says Pakistan can export smartphones within six months if the promised export rebate is implemented
Ten army, two paramilitary soldiers killed as militants attack Pakistan check post
- Tuesday’s attack took place on joint army-FC check post in Mali Khel area of Bannu District
- Seven policemen abducted by gunmen from Bannu district on Monday recovered by police
ISLAMABAD: Ten Pakistan army soldiers and two from the paramilitary Frontier Constabulary were killed on Tuesday as militants attacked a checkpost in the northwestern Bannu district, the army said in a statement on Wednesday.
Pakistan’s northwestern Khyber Pakhtunkhwa (KP) province has seen a surge in attacks in recent months, which Islamabad says are mostly carried out by Afghan nationals and their facilitators and by Tehreek-e Taliban Pakistan (TTP) and other militant groups who cross over into Pakistan using safe haven in Afghanistan. The Taliban government in Kabul denies the charges, saying Pakistan’s security challenges are a domestic issue.
The remote southwestern province of Balochistan has also seen an increase in strikes by separatist ethnic militants this year.
Tuesday’s attack was on a joint army-FC check post in the Mali Khel area of Bannu District, with six militants killed in the exchange of gunfire, the army said.
“The attempt to enter the post was effectively thwarted by own troops, which forced the khwarij [militants] to ram an explosive laden vehicle into the perimeter wall of the post,” the statement said.
“The suicide blast led to collapse of portion of perimeter wall and damaged the adjoining infrastructure, resulting in Shahadat [martyrdom] of twelve brave sons of soil that include ten Soldiers of the security forces and two soldiers of Frontier Constabulary.”
On Monday, seven policemen were abducted from a check post in Bannu district, but the cops were recovered on Tuesday through the efforts of local tribal elders and a massive search operation by police in the unforgiving mountainous terrain.
The TTP, which operates along the Pak-Afghan border, is separate from the Afghan Taliban movement, but pledges loyalty to the Islamist group that now rules Afghanistan after US-led international forces withdrew in 2021.
Islamabad says TTP uses Afghanistan as a base and that the ruling Taliban administration has provided safe havens to the group close to the border. The Taliban deny this.
Pakistan VPN ban could hike IT sector operational costs by $150 million annually — association
- Pakistan’s IT sector has been thriving in recent years, with exports clocking in at $3.2 billion in fiscal year 2024
- Business Council says many multinational firms considering relocating from Pakistan, some having “already done so”
KARACHI: The Pakistan Software Houses Association (P@SHA), the country’s top representative body for the IT sector, has warned this week Internet slowdowns and the restriction of virtual private network (VPN) services could lead to financial losses and closures and increase operational costs for the industry by up to $150 million annually.
Pakistan’s IT sector has been thriving in recent years, with exports clocking in at $3.2 billion in FY24.
Internet speeds in Pakistan have dropped by up to 30-40 percent over the past few months, according to the Wireless and Internet Service Providers Association of Pakistan (WISPAP) as the federal government moves to implement a nationwide firewall to block malicious content, protect government networks from attacks, and allow the government to identify IP addresses associated with what it calls “anti-state propaganda” and terror attacks. Authorities have also announced a ban on the use of VPNs in the country.
Pakistan has already blocked access to social media platform X since the February general elections, with the government saying the blocking was to stop anti-state activities and due to a failure by X to adhere to local Pakistani laws.
Rights activists say all these moves are designed to stifle critical voices and democratic accountability in the country, which the government denies.
“Internet slowdown and blocking of virtual private network (VPN) services will certainly translate into an existential threat as it will result in unrecoverable financial loss, service disruptions, and reputational loss in the export of IT and IT-enabled Services (ITeS),” P@SHA Chairman Sajjad Mustafa Syed said in a statement released on Tuesday, putting “cautious estimates” of the increase in operational costs of the IT industry from VPN blockages at between $100-150 million each year.
In August, the Pakistan Business Council (PBC) warned that frequent Internet disruptions and low speeds caused by poor implementation of the national firewall had led many multinational companies to consider relocating their offices out of Pakistan, with some having “already done so.” P@SHA also said that month Pakistan’s economy could lose up to $300 million a year due to Internet disruptions caused by the imposition of the firewall.
“Even by conservative estimates the IT industry will suffer losses in tens of millions of dollars in the short term; and the reputational and intangible loses will be huge and devastating for the industry in the longer run, especially with the global competitive landscape evolving in this space,” Syed said.
He said the Internet slowdown and VPN blocks would deal a “huge blow” to one of the fastest-growing industries of Pakistan and create a “domino effect” on other sectors of the economy.
“Domestic and international IT companies will be forced to close or significantly restrict their operations in Pakistan – and it will be detrimental to the most flourishing industry of Pakistan vis-à-vis exports, skills development and employment generation,” Syed added.
“In addition to this, it will be extremely demoralizing and discouraging for our IT companies, their workforce, start-up entrepreneurs, freelancers, and everyone involved in the sector – who are working very hard to bring Pakistan at the forefront of global technology destinations.”
Pakistan’s IT and ITeS exports have been growing at an average of 30 percent per year, and are on the way to achieve over $15 billion in the next 5 years, according to industry data, provided the government ensures continuity in export, fiscal, financial, SME, infrastructure and IT policies.
“If the VPNs are blocked, most of IT companies, Call Centers, BPO [business process outsourcing] organizations of Pakistan will lose all the major Fortune 500 clients, as well as others – as data protection and cybersecurity are of paramount importance to our clients, and connecting to client systems through VPN is a global norm and standard, and is a basic requirement and expectation of clients around the world,” Syed said.
“Additionally, no international company of any size tolerates any intrusion into their security protocols by any private or public institution.”
He said the estimated financial losses from the moves did not include the inevitable loss of livelihoods of remote workers and freelancers, urging authorities to engage with P@SHA, industry leaders, and relevant stakeholders to develop a “balanced and secure framework” that safeguarded national security without compromising the operational needs of the IT and other economic sectors of Pakistan.
Washington says working with Pakistan to enhance civilian and military anti-terror capabilities
- Pakistan’s northwestern Khyber Pakhtunkhwa province has seen surge in militant attacks in recent months
- Southwestern province of Balochistan has also seen increase in strikes by separatist ethnic militants this year
ISLAMABAD: US State Department Spokesman Matthew Miller said this week Washington was working closely with Pakistan to enhance the counterterrorism capabilities of its civilian and military agencies, amid a rise in militancy in the South Asian nation.
Pakistan’s northwestern Khyber Pakhtunkhwa (KP) province has seen a surge in militant attacks in recent months, which Islamabad says are mostly carried out by Afghan nationals and their facilitators and by Tehreek-e Taliban Pakistan (TTP) and other militant groups who cross over into Pakistan using safe haven in Afghanistan. The Taliban government in Kabul denies the charges, saying Pakistan’s security challenges are a domestic issue.
The remote southwestern province of Balochistan has also seen an increase in strikes by separatist ethnic militants this year.
“We continue to have an important bilateral counterterrorism partnership with the Government of Pakistan, and it includes regular high-level dialogues and working level consultations dedicated to enhancing both civilian and military capabilities to detect and counter these type of threats,” Miller said at a press briefing on Tuesday evening.
Responding to a question about media reports that eight Pakistani soldiers had been killed in the country’s northwest, and seven police officers abducted near the Afghan border, Miller said the US “condemned these and all terrorist attacks.”
“I would just say, as these horrific attacks against the Pakistani people continue, we remain committed to engaging with government leaders and civilian institutions to identify opportunities to build capacity in detecting, preventing, and responding to threats posed by militant terrorist groups,” the spokesman added.
On Tuesday, Pakistan said it had approved a “comprehensive military operation” against separatist militant groups operating in Balochistan. The government did not provide any details of the military operation such as when it would be launched and in which parts of the province and which security agencies would participate.
Pakistan, Saudi Arabia discuss ‘beggar mafia’ menace, vow crackdown — interior ministry
- Beggars abusing visas to beg in foreign countries has Pakistan worried it could impact genuine visa-seekers and religious pilgrims
- Interior minister says names of 4,300 beggars added to no-fly list, “zero tolerance policy” being adopted against beggar mafia
ISLAMABAD: Pakistani interior minister Mohsin Naqvi on Wednesday met Saudi Deputy Interior Minister Dr. Nasser bin Abdulaziz Al-Dawood in Islamabad and discussed the growing menace of Pakistanis traveling to the Kingdom on pilgrim and other visas and resorting to begging, the interior ministry said.
The trend of beggars abusing visas to beg in foreign countries has Pakistan worried that it could impact genuine visa-seekers and particularly religious pilgrims to Saudi Arabia. According to widespread media reports, Riyadh has raised this issue with Islamabad at various forums.
“Discussions on suppressing the mafia that sends beggars from Pakistan to Saudi Arabia discussed,” the Pakistani interior ministry said in a statement after Naqvi met Al-Dawood. “A zero tolerance policy has been adopted against beggars going to Saudi Arabia.”
The interior minister said the names of 4,300 beggars had been added to a no-fly list and an “effective crackdown” was being carried out across the country.
The two officials also agreed to implement a prisoner exchange agreement, with Naqvi saying legal proceedings for the repatriation of 419 Pakistani prisoners in Saudi Arabia would be “completed soon.”
Previously, Naqvi had tasked the Federal Investigation Agency (FIA) with cracking down on the network of beggars traveling illegally, saying it was damaging Pakistan’s image abroad.
Pakistanis are the second-largest expatriate community in the Kingdom, with over 2.5 million living and working in Saudi Arabia, the top source of remittances to the South Asian country.
Pakistani privatization chief pitches sale of PIA, other state entities to Azerbaijani officials
- Pakistan is looking to sell debt-ridden state enterprises as envisaged under $7 billion IMF program approved in September
- Pakistan wants to position itself as pivotal trade and transit hub connecting China and Central Asia with the rest of the world
ISLAMABAD: Pakistan’s privatization chief Abdul Aleem Khan on Wednesday met Azerbaijan’s economy minister Mikayil Jabbarov and discussed, among other issues, the sale of national carrier PIA and other loss-making state entities.
Cash-strapped Pakistan is looking to offload a 51-100 percent stake in debt-ridden PIA to raise funds and reform state-owned enterprises as envisaged under a $7 billion International Monetary Fund program approved in September. The process, however, hit a snag last month when the final bidding round attracted just one bid of Rs10 billion ($36 million) for a 60 percent stake in the national flag carrier.
PIA’s existing liabilities stand at approximately Rs250 billion ($896 million).
Pakistan is also trying to sell power distribution (discos) and other loss-making state owned companies that are a main hole in its $350 billion economy.
“Discussions with the Azerbaijani government on government-to-government and business-to-business partnerships regarding privatization in Pakistan were discussed in the meeting,” Khan’s office said in a statement after he met Jabbarov in Baku.
“Participation in privatization of PIA, Agricultural Development Bank, discos, utility stores and other projects offered.”
According to the statement from the Pakistani side, Khan said Pakistan and Azerbaijan could make “mutual investments” in the LNG and renewable energy sectors.
“There can be huge investments in the IT sector, telecom, agriculture, energy and other sectors,” Khan said, apprising the Azerbaijani official of cooperation opportunities in Pakistan’s communication sector as well. “We have to take concrete and practical steps to increase the volume of bilateral trade.”
Khan is in Azerbaijan on a two-day visit, and will attend various meetings aimed at discussing investment opportunities and strengthening bilateral relations.
Pakistan wants to position itself as a regional trade hub, leverage its strategic geopolitical position and enhance its role as a pivotal trade and transit hub connecting China and Central Asia with the rest of the world. In recent months, there has been a flurry of visits, investment talks and economic activity between Pakistan, China and Central Asian states, including Uzbekistan, Azerbaijan, Tajikistan and Turkmenistan.
