Pakistan's new telecom policy to boost growth

Pakistan Telecommunication Policy 2015, launched recently, is a milestone and catalyst for industrial growth, the multi-billion dollar foreign and Pakistani investors in the sector said.
The new policy is a consensus document of the government and all stakeholders of the sector to push the industry higher and expand opportunities for foreign and domestic investors in Pakistan.
But, they said it will depend as to how the policy is implemented.
Unveiling the policy, Minister of State for information Technology and Telecommunications Anusha Rehman said efforts for the development of IT and telecom industry have been appreciated globally.
"Pakistan is becoming a leading country internationally with respect to accelerated to growth and development in the IT and telecom sector," she said.
"Just two-and-a-half years ago, all the key posts at the ministry and Pakistan Telecommunications Authority (PTA), the government regulator for the telecom sector, were vacant. The system was running on an ad hoc basis.
"Grey traffic was at the peak. The broadband service penetration was less than three per cent. Little work was done with respect to Universal Service Fund. In contrast, by now right men have been selected for the right positions which has resulted in the big turnaround, everyone at home and abroad now sees," she said.
Rehman insists that better administration and a number of reforms, undertaken by the government, have curbed misuse of telecom services by consumers and small vendors.
"It has resulted in bigger profits for the genuine operators. This is topped by the large expansion in the number of customer base, the vast expansion of the economy and good dividends for the present and future investors," she said.
Rehman said that the grey traffic has come down to a negligible level, while white traffic has increased to over 1.5 billion minutes, which came to a huge amount in terms of cash. "Cyber law is being finalised in consultation with all stakeholders," she said.
All investments by foreign and domestic investors and institutions are fully protected under the Pakistani laws. The investors can remit abroad all their dividends and profits. They can also take home their actual investment.
Implementation of the policy is now the real task ahead, principally to be undertaken by the PTA and the ministry, in cooperation with the private sector itself.
"The policy has been announced, but now the big challenge is its implementation. All the stakeholders need to work for a smooth implementation of the policy," said PTA chairman Syed Ismail Shah.
Views expressed by the author are his own and do not reflect the newspaper's policy.
Other stakeholder and IT service-providers and investors have also made their comments.
While the latest policy seem to be pro-growth, what has slowed down the telecom growth so for is the heavy dose of taxes on the operators, most of which are transferred to the customers and users of various services.
Mohammad Aslam Hayat, chief corporate affairs and strategy officer of Telenor Pakistan, said: "For a top up of Rs100, what the customer actually gets is Rs66 - meaning his usage capacity is reduced by 34 per cent right away."
In some of the regions like Punjab high taxes eat away much more. One estimate is that from each of Rs100 top up, taxes in Punjab take away Rs40 - letting only Rs60 to be used by the customers.
"In order to survive, the telecom sector is going towards consolidation, and if the situation does not improve there will be job losses in the short term," Hayat said.
The MoITT and the PTA should take care of the excessive taxation and other problems. The taxes should be immediately brought down as they are considered to be the highest in the world and hitting the industry and the customers too hard.
Abdul Aziz, CEO of Ufone, said: "The telecom policy is a frame work and guidelines to move forward. However there is a need of practical solution and the policy needs to be implemented to achieve the desired goals. We need to highlight and focus on some points including competition within the industry, as we have not managed a balance yet n this area."
Mobilink CEO Jeffrey Hedberg said: "The telecom policy is progressive, which is being recognised inside, as well as outside the country. The policy will be a catalyst to accelerate industry growth in the country as it covers the financial inclusion of the people."
Fan Yunjun, chairman and CEO of Zong has termed the telecom policy as "a good achievement."
"It will play a pivotal role in the acceleration of digitalisation in the country," he said.
Now when every thing has been put on the table the investors hope and strive for growth and the customers for slashing down the taxes.
Views expressed by the author are his own and do not reflect the newspaper's policy.