Digital Pakistan: Broadband Subscriptions Soar to 100 Million
Broadband subscriptions in Pakistan have soared from 2 million in 2012 to 100 million now, according to the country's telecommunications regulator. Ookla, recognized globally for its broadband speed testing, reports that Pakistan's average broadband download speed is 11.35 Mbps, while its upload speed stands at 10.7 Mbps. Thousands of kilometers of new fiber optic cable is being installed and mobile data usage in Pakistan has recently surged to 8,000 petabytes. Smartphone sales are also swelling. All signs are pointing to Digital Pakistan becoming reality in the near future.
|Broadband Subscriptions Growth in Pakistan. Source: PTA|
Pakistan Telecommunications Authority (PTA), the nation's regulator, said in a statement that 87% of the population has access to the internet at the lowest rates. PTA claims the average download speed is 17.7 Mbps, and the upload speed is 11.3 Mbps, higher than the speeds measured by Ookla recently. Ookla found that mobile download speed in Pakistan is 40% faster than in India. It reported that download speed in Pakistan has grown 24% over last year, while the speed in India grew 12% in the same period.
Rising broadband subscriptions have triggered a significant increase in Internet data, particularly with the spike in Internet traffic caused by the COVID19 pandemic related lockdowns. Mobile data usage in Pakistan has recently soared to 8,000 petabytes.
|Mobile Data Consumption in Pakistan. Source: Rogue Economist|
Both the private sector and the government are laying thousands of kilometers of new fiber optic cable to deal with growing mobile broadband subscriptions and expanding coverage. In addition, the growth in international data traffic is being met with new high-speed undersea cables.
Pakistan and East Africa Connecting Europe (PEACE) is 96 Tbps (terabits per second), 15,000 km long, privately owned submarine cable that will originate in Karachi, Pakistan and run underwater all the way to Marseilles, France via multiple points in the continent of Africa. It is being built as part of Digital Silk Road sponsored by China. Cybernet and Jazz are the local landing and global connectivity partners of PEACE Cable System in Pakistan. It will enable high-speed access to a variety of content, cloud computing, gaming and video streaming platforms.
|PEACE Undersea Cable Route. Source: Submarine Cable Networks|
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“Pakistan is rapidly progressing when it comes to mobile broadband. Our country has enormous potential with respect to widening financial inclusion through digital solutions. Currently, 95 million people across the country use mobile broadband, a number which has grown by 50 million in the past 5 years. A majority of adults have broadband connections in Pakistan serving as a backbone to developing a digital payments ecosystem in the country.” said M. Mudassar Aqil, CEO Easypaisa/Telenor Microfinance Bank, while talking about Pakistan’s financial services landscape.
“96% individuals have a biometrically verifiable ID issued by the government, indicating that a robust regulatory framework is in place which is supported by credit bureaus. Despite these fundamental factors, 70% of Pakistanis don’t have access to financial services when the rails to address these challenges are in place,” he added. During COVID-19, digital payments witnessed a boom. According to the SBP’s quarterly report, 296.7 million e-banking transactions, valuing at PKR21.4 trillion, were carried out during Oct – Dec 2020, growing by 24% in volume and 22% in value compared to the same quarter last year.
“During COVID-19 industry numbers of digital transactions grew at an exponential rate. At Easypaisa, our annual throughput increased by 64% as compared to the previous year reaching PKR 1.5 trillion in 2020. Similarly, the number of active Easypaisa App users reached 3.44 million, registering a 54% increase in comparison to previous year.” he commented. Pakistan is predominantly a cash-based economy. However, things are changing as the use of digital payments is taking center-stage.
Mudassar opined: “The Pakistani economy is ready to adopt digital financial solutions on a large scale as opening a mobile wallet account on a smartphone or feature phone takes less than a minute. Roughly PKR 6 trillion or about one-third of the country’s deposits are in circulation. This is one of the highest percentages anywhere in the world and the only way to reduce this is for every adult in the country to have a mobile wallet. Furthermore, all retail outlets in Pakistan should be mandated by law to accept digital payments from mobile wallets. Tax incentives should also be introduced making digital payments cheaper than cash.”
LAHORE-Edkasa, a fast-growing education technology startup in Pakistan, has launched its new exam prep mobile application, aiming to reach millions of secondary school students. Edkasa already has a user base of 55,000 students and more than 40 schools throughout Pakistan that currently use its solutions. This new exam prep app is an evolution of this work, and will leverage and grow its existing community. The company has already helped thousands of students, and recorded over 1.3 million hours of viewing time with over 250,000 queries answered by its teachers in 2020. “Education is the biggest bridge between the world that we have, and the world that we want,” said Annum Sadiq, Co-Founder of Edkasa along with Fahad Tanveer. “Edkasa is a dream coming to fruition, as we prepare to educate millions of Pakistani learners.”
The new mobile application, available to download for Android smartphone users (iOS will be available soon), features an initial quiz to gauge a student’s requirements, and then offers customised studying paths based on their needs such as a specific exam, subject, or exam board. Matric and Intermediate students from classes 9-12 can view over 4,500 video lectures on demand and take quizzes based on 15,000 past paper multiple choice questions (MCQs) to gauge their understanding of specific topics. Students can also see how they rank on the app’s leaderboard, compared to fellow Edkasa students from across their exam board, city, or country to get a sense of where they stand. Students sign up for the app for free, continue with a monthly subscription fee starting as low as Rs 899 per month, gaining access to Edkasa’s learning material in Maths, Physics, Chemistry, Biology and English. Edkasa teachers are highly qualified, with experience educating thousands of students.
The Edkasa app has been designed with feedback from Edkasa’s pre-existing user base, and is also aimed at countering the effects of school closure and an uncertain learning environment due to Covid-19. The launch comes ahead of Board examinations in June, and gives young learners in Pakistan a timely chance to revise studying material.
Edkasa, co-founded in 2017 by LUMS alumnus and Fulbright Scholar Annum and LUMS and Harvard alumnus Fahad, leverages mobile broadband technology to offer online remedial classes for standardised exam preparation. Its Chief Technology Officer, Muneeb Ali, a GIKI gold medalist, is also the founder and CEO of OneByte, which works with pre-seed, early-stage, and growth-stage startups to help build their products.
The company raised a pre-seed round of USD320,000 led by i2i Ventures, with participation from Walled City Co., Zayn Capital, and strategic angels in Southeast Asia. The investment was made to build out the exam prep app and scale Edkasa’s e-learning impact with students across the country.
The majority of Pakistan’s online users come from a lower socio-economic segment with low levels of literacy. They have come online recently and are navigating interactive devices like smartphones for the first time in their lives. Most of them only use apps like Whatsapp (100%) and Facebook (about 60%) and very few of them do online shopping.
Most blue-collar workers which include drivers, cooks, guards, office boys, electricians, gardeners and shopkeepers fall in this group. Only a quarter of them have access to consistent, stable internet connectivity. Still getting familiarized with the majority of features on their newly acquired smartphones, they do not occupy the same digital spaces, and are unable to navigate most of the sites and apps that most of the upper socio-economic segment frequently uses.
To install a new app on their smartphones, most users typically have to uninstall other apps they use, due to lack of space. Phones also crash routinely due to insufficient memory. There is also a major language and user interface barrier as most interfaces are in English. A recent survey conducted by Rozee in worker colonies revealed that their primary mode of online communication is through voice notes on Whatsapp, followed by messages written in Urdu. Some also use Facebook, Tiktok, Google, and Youtube. Many are neither aware of nor have ever used the web browser on their phones. Few local online services have been built understanding these constraints.
Meanwhile, the number of Pakistan’s online users has skyrocketed during the last five years. To be more precise, out of 85 million connected smartphone users in Pakistan today, a staggering 70 million came online just during the last five years. In the last year, e-commerce and mobile payments growth have swelled 300% to 400%, further propelled by the COVID-19 pandemic. Majority of the users have second-hand Chinese handsets and widely available 3G/4G networks.
Prevailing conventional wisdom amongst our local digital ecosystem is that this segment is not profitable and difficult to monetize. Thus, the focus has been on the Haves rather than the Have-nots. The former orders gourmet food on FoodPanda, buys eye shadow on Daraz, a DHA plot on Zameen, or a bank executive job on Rozee; while the latter have been largely excluded from participating in the massive opportunity created by this quickly evolving digi-sphere. While our e-commerce market has rapidly grown to over USD $4 billion annually, this growth has come almost entirely from the top 40% of the online users.
However, there are some very encouraging early signs of disruptive progress.
During the COVID-19 lockdown, the majority of daily wage workers were displaced as supply chains, businesses and affluent households closed their doors. The Rozee team spent considerable time in worker colonies digitally onboarding unemployed workers on to a donation platform named Project Pakistan. They engaged 60 volunteers from worker communities armed with smartphones. They recorded videos of workers, assessed household incomes, digitally verified ID cards, and did skills assessments. The software identified the neediest of them. In three months, donations were digitally sent to 10,000 households consisting of over 60,000 people. Thanks to technology, a core team of only five people from Rozee managed to make this happen.
Building on this experience, Rozee and UNDP partnered for the development of Rozgar.pk – a blue-collar employment platform that digitally onboards the often ignored blue-collar worker segment, and connected them with part-time or full-time opportunities near them.
Assessing its future, both the bad and the good.
By Kara Swisher
Ms. Swisher covers technology and is a contributing opinion writer.
The freaky video of the New York Police Department’s robot dog owned the internet earlier this month. The minute that DigiDog creepily trotted out of a public housing building, many people decided that the “Terminator” future had arrived — and that humanity was doomed.
Humanity is not doomed. But the hubbub got me thinking about how to assess the future of tech, both the bad and the good, in the wake of the pandemic.
Much like the major changes that raced through American society after the 1918 Spanish flu pandemic (also after World War I), this will be a jarring time. Here’s my take on five of the key arenas we need to be thinking about post-pandemic.
Telecommuting. Work, and specifically its shift from the office to the home, has been one of the most significant changes of the past year. Of course many jobs still require physical presence, but the number of workers who do not have to be analog is vast and growing.
These so-called knowledge workers have realized — even with all the griping about being on Zoom all the time — that it can be both cheaper and more productive to have a work force that is more flexible in terms of place and time.
Telehealth. Health care is another area that was ripe for disruption prepandemic, as the industry had resisted tech for many years. A number of giant companies like Microsoft and Google have tried to streamline the consumer health experience, while many others have been part of digitizing the back end, but it’s still a miasma of confusion. The pandemic only underscored the poor state of the country’s health services.
Retail. Physical retail — including restaurants and bars — has been under enormous pressure for years, as tech companies have increasingly placed themselves between the goods and customers. All the while, tech companies have been building one moat after the next to solidify their strength by providing better service, streamlining delivery logistics and offering better prices.
Tele-education. Online education has not worked out so well in the past year. A reliance on virtual education has taken a toll on our mental health and revealed inequities in internet access. It’s still a problematic experience for most users. Everyone I talk with agrees that it’s been a failure for most students.
Innovation. The most important thing to come out of the pandemic could be a flowering of innovation, across a wide variety of sectors. After the 1918 pandemic, the 1920s saw a burst of aggressive ideas, most especially with the introduction of the television.
While I can’t predict what the 2020s equivalent of that will be, if I had to guess, I would say we’ll see new breakthroughs related to the messenger RNA technology used to develop several Covid vaccines. Such a thing would be both ironic and fitting, and in keeping with how innovation works: Out of the ashes of great distress comes a major discovery. And the rest is, as they say, history.
The premier said that the subsidy on DAP (diammonium phosphate), which was previously Rs500, would also be increased to Rs1,000 under the Kisan Card.
"Subsidies will also be available for seeds and pesticides," said the prime minister, adding that loans to farmers would also be provided through the card and preparations for this were already under way.
The premier said that during the PTI government's tenure, farmers had gained an additional Rs1,100 billion due to the prices they received for produce such as sugarcane, wheat and corn.
"Pakistan's poverty is concentrated in rural areas," he said, adding that the additional money that farmers would gain would help to improve their standard of living. He said that reducing poverty had been the "real purpose" of the PTI government since day one, adding that it was now "moving towards that target".
The prime minister also mentioned other measures the government was taking to improve the agricultural sector and pointed out the Rs300bn transformation package.
"Water is a very big problem. If farmers face water shortages then their produce is affected," he said, adding that two big dams were being made after 50 years to address this issue and Rs220bn from the transformation package was set aside for the fortification and lining of canals. Additional small scale water projects were also being carried out, he said.
He also stated that due to his efforts, agriculture had been brought under the scope of the China Pakistan Economic Corridor (CPEC) to benefit from Beijing's agricultural technology and seed development. Pakistan's own research institutions on seed development would also be revamped, the premier said.
The prime minister also stated that a lot of agricultural produce that was imported, would now be grown in Pakistan, adding that the country's favourable climate and temperature provided the necessary conditions to increase crop yield.
"Our farmers are still using old methods," lamented the premier and stated that extension services were being privatised. A trained professional per Union Council would be responsible for visiting farmers on a motorcycle in the area and informing them about new agricultural techniques.
"There is great need for this because we need [to adopt] new [agricultural] practices," said the prime minister, adding that Pakistan's agriculture was subsistence level so "we will train them (farmers) through extension services to increase their productivity."
He also pointed out initiatives to develop Pakistan's livestock and said Pakistan still imported milk due to low productivity. Thus, Rs40bn have been set aside to import semen so livestock breeds could be improved, said the premier.
"You will see that change will come in one to two years and because of that, milk production will increase three-fold," he said, adding that improving the breed of livestock will not only allow Pakistan to provide cheap milk but also export cheese and milk.
"We can earn $25bn just from cheese and milk exports in the next three years."
Prime Minister Imran Khan lamented the losses that vegetables and fruits suffered at 50 per cent and 20pc for grains. "So we have decided to develop storage for them and food processing plants," he announced, adding that billions of rupees were lost due to 20pc of wheat being lost and fruits and vegetables could otherwise be provided much cheaper.
Among other measures he mentioned were doubling of loans for farmers, local production of fertilisers, doubling cereal production as well as improving local production of medicinal plants, corn and developing the fishery sector such as prawns.
Top government officials, analysts and corporate leaders repose trust in the growing economy and said higher GDP growth in the five-to-six per cent per annum range is going to be a ‘new normal’ in the next five years considering strong economic indicators.
“Yes, we have a potential to grow at much higher rate in coming years. The State Bank of Pakistan [SBP] projects three per cent GDP growth in financial year 2020-21 and four per cent in 2021-22,” SBP governor Dr Reza Baqir told Khaleej Times during a recent event.
Newly-appointed Finance Minister Shaukat Tarin said Pakistan will go for an ambitious six per cent economic growth target in the next two years as the International Monetary Fund (IMF) shows its willingness to renegotiate tough conditions for a $6 billion loan in the wake of rising Covid-19 cases.
“The federal government will earmark as much as Rs900 billion [$6 billion] for development expenditure in the year beginning July. That’s the bare minimum we need for a country this size,” he said.
Climbing the charts
The IMF has projected four per cent GDP growth for Pakistan during fiscal year 2021-22, which starts in July. Islamabad is expected to post a 1.5 per cent expansion during the current fiscal year ending on June 30 after a rare contraction of -0.4 per cent last year.
“We have strong economic indicators this year despite the Covid-19 pandemic challenges and this is a good omen for the economy. The government ensures more than Rs2 trillion stimulus to steer the economy out of Covid crisis by supporting the businesses through much-needed liquidity and funds distribution at grass root level,” Dr Baqir said.
Elaborating, the central bank governor said the SBP offered Rs450 billion liquidity under its Temporary Economic Refinance Facility to the private sector to absorb the Covid shock, while another Rs240 billion was provided as working capital to avoid layoffs and job losses.
“The central bank also offered a Rs900 billion cushion to banks to ensure relief to distress businesses in deferment and restructuring of principal payment and mark-up charges. These are some of the measures which helped the economy to bounce back quickly to meet global demand after the lockdown period,” Dr Baqir said.
Referring to rising foreign exchange reserves, an orderly rupee-dollar parity, improving current account balance and other economic indicators such as large-scale manufacturing, cement, automobiles and fast-moving consumer goods, the SBP governor said the economy is moving in the right direction and will perform better in coming years.
“Pakistan is one of the few countries that reduced its fiscal deficit despite the Covid challenge and global economic slowdown by reprioritising spending. The country’s public debt-to-GDP ratio has remained broadly stable last year while it has risen for most emerging markets due to Covid; this has improved the country’s creditworthiness,” he said.
High single-digit growth
Samiullah Tariq, head of research at Pakistan Kuwait Investment, said the country’s economy should grow at much higher rates to realise the true economic potential of the country.
“Pakistan is a nation of 220 million-plus people and every year new earners are now coming into the main stream. Renewable energy is providing everyone a sustainable and cheap energy making lives easier and production cheaper,” Tariq told Khaleej Times.
“IT, e-commerce, the Internet and cellular sectors have huge potential to drive economy into fast lane and achieve much higher GDP growth in next five years. High signle-digit growth is going to be a new normal in years to come,” he said.
The country took one step further towards expanding its internet horizon on Thursday with Khyber Pakhtunkhwa (K-P) conducting the successful test of 5G technology for consumers at the Durshal Incubation Center in Peshawar.
The PTCL Group and Khyber Pakhtunkhwa Information Technology Board (KPITB), under the umbrella of Department of Science and Information Technology, conducted the 5G trial in a limited environment on a non-commercial basis.
The demonstration included successful remote surgery concept, cloud gaming and an overview of anticipated 5G technology applications in Pakistan. Once the infrastructure and systems are operational, surgeons will be able to perform surgeries remotely in the far-flung areas.
Once operational, Pakistan would join a select group of nations benefiting from the latest internet tech. The first country to adopt 5G was South Korea way back in 2019. Other leading nations like Switzerland, Kuwait, Finland, Qatar, US, UK, China, Italy, Spain, Australia etc followed later.
There are a host of others, including India, who have started making remarkable progress with 5G or have already achieved 5G technology. Noman Ahmed Said, Chief Executive Office (CEO) Si Global said that there were several advantages in introducing 5G in Pakistan.
The advantages, he added, included increased bandwidth along with faster speed with the potential to integrate seamlessly with technology that supported it. “The 5G, the 5th generation mobile network, enables a new kind of network that is designed to connect virtually everyone and everything together, including machines, objects, and devices,” he told The Express Tribune.
K-P Senior Minister and Minister for IT, Science and Technology Atif Khan termed the 5G trial in Peshawar a “significant milestone in the history” of K-P. Speaking at the trial, he congratulated all the stakeholders on “making significant contribution to this latest technology demonstration”.
“This technology, once deployed, will enable provision of best medical and healthcare facilities to remote areas, provide international-level education opportunities to the underserved areas, and have a significant overall impact on the socio economic landscape of the country,” he added.
The main challenges facing the developing counties like Pakistan in implementing 5G is that “we have very recently implemented 4G for which the overall roll-out phase is still incomplete”, Said said. “There are also major technical challenges that we are likely to face while deploying 5G.”
According to Said, there were various security aspects of the 5G networks, which were an ongoing issue and added: “We are currently not technologically competent to handle the many security glitches of 5G networks.”
He said: “Additionally, there are infrastructural hurdles that will need to be completely reworked and will also involve heavy costs in doing so. Spectrum costs, costs of increased network density and dynamic spectrum sharing are also issues that are to be considered.”
Said said that introducing 5G would be a massive step in the formation of a Digital Pakistan in accordance with the vision of Prime Minister Imran Khan, adding that 5G would facilitate the move towards digital currency and cryptocurrency, putting the country at par with the rest of the world.
According to Si Global CEO, implementation of 5G could ultimately change the technological landscape of Pakistanm but stressed that several arrangements had to be made prior to its implementation.
He (Minister of IT) said the (Pakistan federal) government had also decided to set up an information technology park near the Jinnah International Airport in the trade and business hub of Karachi at a cost of Rs 31 billion.
The IT park would house about 210 IT companies having 8,400 employees. Pakistan Software Export Board (PSEB) would act as the project executing agency and complete it in six years.
The IT park would span over an area of 106,449 square meters with eight floors above the ground and three basement floors, he said.
To a question, the official said the ministry of IT had recently inaugurated IT Park in Islamabad, consisting of twelve-storey self-contained building on covered area of 66,893 square meters.
The IT Park would be developed with state-of-the-art infrastructure and allied facilities for IT companies with financial assistance of Exim Bank, Korea, he added.The project, he said, would be completed in 30 months with the total cost of Rs 13.72 billion.
South Korean tech giant Samsung has been in talks with three investors for setting up a mobile manufacturing unit in Pakistan.
Sources said out of three parties, one has a franchise from Korea which has already set up vehicle assembling plants in Pakistan under Auto Development Policy (ADP) 2016-21, while other two are different parties.
They said so far no agreement has been signed as Samsung, after short listing various companies, is in the process of finalising its plan to award the licence to one of the companies for cellphone manufacturing.
The world’s biggest smartphone maker said in an earnings estimate on Wednesday that it expected operating profit of around 12.5 trillion won ($11 billion) for April to June, up from 8.15 trillion won a year earlier.
Companies being shortlisted for award of licence
“The Korean company aims to start local assembly of cellphones in the last quarter of this year,” a source, who is looking after the development in the mobile phone sector, told Dawn on Wednesday.
Market sources said Samsung may prefer the option to ink the agreement with one of the Korean companies operating in Pakistan owing to comfort level which it may not find with non-Korean firms.
The Engineering Development Board (EDB), an arm of the Ministry of Industries and Production (MoIP), approved Mobile Device Manufacturing Policy (MDMP) in 2020 and so far 21 companies have been given the green signal for mobile device manufacturing authorisation from March to June 2021.
As per EDB list, factories’ locations include Rawalpindi, Karachi, Lahore, Faisalabad and Islamabad. Some prominent brand names include Nokia, Oppo, Infinix, Tecno, Itel, Vivo, Alpha, Realme, VGOTEL, DCODE, Calme, Xcell, Spice, TCL, Alcatel, etc.
Sources said that the government has framed MDMP to encourage foreign players to take a plunge in Pakistan for setting up cellphone manufacturing unit. The aim is to produce the product under the banner of “Make in Pakistan” and to discourage imports.
Cellphone imports, as per figures of Pakistan Bureau of Statistics (PBS), have swelled by 63pc to $1.860 billion in 11MFY21 from $1.138bn in the same period last fiscal year.
According to the Economic Survey 2020-21, during July 2012 to February 2021, telecom sector has attracted over $3.9 billion of Foreign Direct Investment (FDI). The FDI in telecom during July-February FY21 was $101.1 million. Telecom operators have invested an amount of $363.9m during July-December FY21.
The main driver behind this investment is the cellular mobile sector which has invested $253.5m during the period. The overall investment in the telecom sector during the first eight months of FY21 crossed $465m. Pakistan’s cellphone subscribers have reached 183.48m till May 2021.
In a landmark development, the Chinese tech giant Xiaomi has announced that it will set up a local assembly unit in the country in three to four months, according to sources. The latest development will not only generate employment opportunities for the indigenous people but will also boost the local smartphone manufacturing space in the country. Furthermore, the local manufacturing of smartphones will also attract foreign direct investment (FDI) and ramp up a foreign exchange through exports.
Tech-giant Xiaomi to Set up Local Assembly Unit in Pakistan: Source
Basically, Xiaomi is following the footsteps of other major brands like Tecno, Infinix, Realme, etc. who have recently announced to open their local manufacturing unit in Pakistan. It will greatly benefit the company as Xiaomi is currently one of the most loved brands in Pakistan. It can be evident if we look at the sale of its recently launched devices like Mi 11, Note 10, etc. The primary reason behind its huge demand is that it renders quality, consumer-centric (gaming phones, camera phones, etc.), and affordable products.
Furthermore, as we know that Xiaomi deals in a range of accessories and IoT products. So if the company’s smartphone local assembly becomes a success story then the company will surely install other product manufacturing assemblies as well.
Currently, Pakistan is the 7th largest importer of mobile phones with a humungous market size of over 40 million users. Thus, consequently, local manufacturing will also save foreign exchange on mobile phone imports.
Lucky Motor Corporation (LMC), a subsidiary of Lucky Cement Limited, has entered into an agreement with Samsung Gulf Electronics Co., FZE (Samsung) for the production of Samsung-branded mobile devices in Pakistan, stated a notice sent to the country’s stock exchange on Friday.
“In pursuance of this transaction, LMC has also initiated the process of seeking necessary regulatory approvals to carry on the said business and, in this endeavor, has filed an application with the Pakistan Telecommunication Authority (PTA) for securing the license,” added the notice.
The notice added the production facility for producing Samsung mobile devices will be located at LMC’s existing plant facility producing vehicles at Bin Qasim Industrial Park, Special Economic Zone, Port Qasim, Karachi.
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“The production facility is anticipated to be completed by end of December 2021. That further information on the amount contemplated to be invested in the production facility and the capacity thereof shall be discussed between the Parties (Samsung and LMC) in due course of time.”
LMC is currently engaged in the business of manufacturing, assembly, marketing, distribution and sales of Kia and Peugeot branded vehicles, parts and accessories thereof, in Pakistan.
The development comes as a major landmark for Pakistan that has been pushing to join the league of smartphone manufacturing countries.
In a bid to boost Pakistan's telecom and manufacturing sector, some 21 new companies have been authorised to start local manufacturing/assembly of mobile phones.
The Extreme Commerce Magna Carta College (ECMCC) and the British Computing Society are collaborating for the development of Pakistan’s first Center Of Emerging Technologies in the private sector, IT industry is highly dependent upon the newest technology developments. Yesterday, the agreement has been signed to start this project.
The collaboration has been established by AccrediNation Founder and Managing Partner, Mr. Asad Aamir Ansari and ECMCC Head, Mr. Abdul Hafeez Malik. British High Commissioner Mike Nithavrianakis and the Director of Commerce for Pakistan also participated in the signing ceremony.
With respect to the idea behind the campaign, Sunny Ali, the founder of Extreme Commerce, said:
“The Center for Emerging Technologies was lacking in Pakistan. While initiatives in the public sector have been made. We are pleased to be leading this initiative in Pakistan.”
In addition, Sunny says how this would provide a new path towards the formation of a new industry of human resources in the country, therefore soon that would lead a greater industry in Pakistan. Founder of AccrediNation’s Asad Aamir Ansari emphasizes as new technologies will help many sectors including the healthcare, finances and more not only IT industry, those will get huge profit from technology like Artificial Intelligence.
In addition, the CEO of Ejaz Chaudhry Magna-Carta college said, “It would enhance employability and the worth of our young people worldwide through IT certifications from BCS UK. In the vibrant and challenging market of today’s world, IT professionals require internationally renowned and industrially relevant knowledge, experience and practical competencies to compete the technology improvements.”
Many smartphone companies have expressed their intention to begin production of mobile phones in Pakistan after cellular giant Samsung collaborated with the Lucky Group to produce high-quality phones in the country.
Now, the companies are making efforts to introduce 5G phones in the local market.
Chinese smartphone manufacturer Realme has shared plans to launch 5G-enabled phones in Pakistan at affordable prices after its parent announced the establishment of a local assembly line in the country.
Speaking to The Express Tribune, Realme Regional Marketing Director Sherry Dong said that the brand received an excellent reception in Pakistan, hence the company was now prioritising the country to introduce 5G mobile phones.
She added that the company was the first smartphone brand in Pakistan to sell over a million devices in less than a year, which was a significant milestone and paved the way for new investments and introduction of diverse products.
She announced that the company was planning to set up a local assembly line for its products after which top-notch technology would be available in Pakistan at affordable prices.
Read More: Why 5G is still out of Pakistan’s grasp
A few years ago, Realme’s parent company, Oppo Mobile Telecommunications Ltd, had expressed its interest in setting up a mobile assembly plant in Pakistan.
Giving further details, she said that the facility would have two separate assembly lines - one for each brand.
With a dedicated assembly line for Realme, the company will introduce 5G-enabled mobiles as well as other artificial intelligence (AI) products at affordable rates.
“5G is the future, therefore, we have to provide up-to-date technological products to Pakistani consumers at affordable prices,” she added.
The company utilises online marketplaces to promote its products because e-commerce has grown significantly in Pakistan due to the Covid-19 pandemic.
Keeping this in view, the management of the smartphone company has decided to introduce its own digital store in Pakistan’s online marketplace.
“We entered into partnerships with a couple of local companies to sell our products, but now we have decided to establish our own digital outlet in Pakistan,” she said.
Sherry added that digital platforms in Pakistan had matured over the past couple of years, but they still lagged behind regional countries.
She pointed out that the company faced some issues with Pakistan Customs as delay in release of shipments had caused shortage of its products.
The two-stage study interviewed 4,135 Pakistanis aged between 15-55 in both urban and rural areas.
The study found that 76% of Pakistanis are connected to the internet in the top three cities of the country.
The study further shows 46% of all Pakistanis access the internet every day.
Pakistan is witnessing a digital revolution and most of the citizens are ready to embrace it as more than half the population of the country access internet on daily basis, a study has revealed.
Google and Kantar shared new research “Journey to Digital” about the digital population in Pakistan. The two-stage study interviewed 4,135 Pakistanis aged between 15-55 in both urban and rural areas.
The study found that 76% of Pakistanis are connected to the internet in the top three cities of the country (Karachi, Lahore, Rawalpindi / Islamabad).
Overall, 66% of internet users are based in urban areas while 47% are based in rural areas. The study further showed that 46% of all Pakistanis access the internet every day.
According to the study, young males are early adopters, who access the internet more than any other group. They are also keener to try new things and need the internet for education and work.
Internet usage surged due to COVID-19, finds the study, as, before the lockdown, 79% of internet users in urban locations accessed the internet daily, which increased by 10% since lockdowns were imposed.
Google Search and YouTube are most popular in Pakistan, said the study. YouTube, used by nearly 90% of all internet users, is the most popular app in Pakistan for streaming music and watching video/TV, and 38% of Pakistan's internet users go to YouTube in the research phase of their shopping journey.
The study also says that one-third of all internet users in Pakistan have made a purchase online and one-fourth of these shoppers have increased their spending during COVID-19 lockdowns.
Pakistan is a witness to the e-commerce boom as 71% of Pakistani shoppers find purchasing products or services online easy, while 66% find it convenient. Another 54% agree that online shopping websites or apps give personalised product recommendations, which is a common question from shoppers.
However, 66% of consumers believe that online shopping is the way forward, and two-thirds of Pakistan online shoppers believe that they will buy products or services online after the COVID-19 pandemic.
Faraz Azhar, Industry Head, Performance, South Asia Frontier Markets, Google explained, “With half of its population on the internet - Pakistan is now online! This is the first time Google and Kantar released a study to understand more about Pakistan’s internet population. But it’s not only about people getting online, this research has uncovered new insights and behaviours that show how COVID is impacting online behaviour and the digital opportunities waiting to be unlocked.”
"More people are coming online in Pakistan, creating a great opportunity for eCommerce businesses - if they are ready to seize it. As we see more exploration of the internet beyond social, e-retailers can capture natural cross-category purchasing on its rise, but only if they have first established themselves and their product offering in an online marketplace," he said.
Trust is also crucial, so helping customers gain confidence by showing them how easy, convenient and personal the e-shopping experience will be critical to continuing the upward rise of eCommerce in Pakistan, Leah Westwood, Client Manager at Kantar added.
"PTA congratulates the company for this landmark achievement. This is the result of concerted efforts for the development of the mobile device manufacturing ecosystem in the country," the authority said in a statement issued on Saturday.
It said that the successful implementation of the Device Identification Registration and Blocking System (DIRBS) and enabling government policies including the mobile manufacturing policy have created a favourable environment for mobile device manufacturing in Pakistan.
"As a part of this policy, Inovi Telecom Pvt. Ltd was issued mobile manufacturing authorisation by PTA on 9th April 2021," it added.
Within four months, according to PTA, the company has managed to export "manufactured in Pakistan" phones.
In recent times, the telecom sector has emerged as a prominent contributor to Pakistan’s economy as its share in the national exchequer soared 129% in 2020 compared to 2019, despite economic pressure arising from Covid-19.
In July, Lucky Motor Corporation entered into an agreement with Samsung Gulf Electronics to produce Samsung mobile phones in Pakistan at its automobile plant at Port Qasim.
In comments to The Express Tribune, Tecno Pack Telecom CEO Aamir Allawala termed the joint venture excellent development for the country
Samsung was a mobile phone giant and its decision to assemble phones in Pakistan was an indication of the success of the Mobile Device Manufacturing Policy (MDMP) launched by the government in June 2020, said Allawala.
The vision of the policy was clear i.e. by 2022, 80% of all mobile phones sold in Pakistan should be locally manufactured, he said.
The brands already being manufactured in Pakistan included Tecno, Infinix, Itel, Vivo, Oppo and Realme while Nokia was in the process of setting up a plant and kick-starting operations in September 2021, Allahwala further said.
KARACHI: One of the world’s largest manufacturers of mobile phones, Samsung, has finally started production in Pakistan, lifting hopes of the authorities and the industry that this would cut down the import bill of the country in the months to come.
The development came to light on Tuesday at a meeting of the company’s top managers with the Senators who visited the production site in line with the plan to receive a briefing on the growing new sector and challenges ahead for the cellphones manufacturing industry in Pakistan.
“We were informed that Samsung has formally started its production,” Faisal Subzwari, chairman of the Senate’s Standing Committee on Industries and Production, told Dawn.
He headed a delegation of members of the Senate panel which visited Samsung’s production unit and an auto manufacturing plant, and held a meeting with the management of Export Processing Zone.
The company aims to manufacture around 3m handsets every year
“It’s really good to know that the company has started production within a short span of four months,” Mr Subzwari said. “We visited the production facility which was designed on modern lines and obviously the local manpower, support of local industry and conducive environment provided by the government led to such achievement. But still I believe that we need to move forward from just growing in the assembling area to localisation of the industry.”
The country has witnessed robust growth in local production of cellular phones. During the first 10 months of this year, the Pakistan Telecommunication Authority (PTA) data says, the production of mobile phones by local manufacturing plants has almost doubled to 18.87 million against the import of mobile phones which stood at 45m.
However, despite the increase in local production of mobile phones, the import remained on a higher side. The PTA data says that mobile phones worth $644.673m were imported during the first four months (July-October) of 2021 compared to $557.961m during the same period of last year, registering a growth of 15.54 per cent.
The industry believes that it may take time to achieve the desired results but with the fresh start in an absolutely new industrial avenue, things have finally started moving in the right direction.
“With production of around 250,000 to 300,000, we aim to produce around 3m cellphones every year,” Mohammad Ali Tabba, chief of the Lucky Group which partners with Samsung to produce cellphones in Pakistan, told Dawn. “The whole production line is manual with no robotic assistance. So you can imagine how much workforce is required offering employment in this absolutely new area of engineering in Pakistan.”
He agreed that the country needed to move towards localisation from its current status of assembling industry and believed it was more the role of the industrial sector than the government to go for modification and compatibility.
“It’s not only the local production of cellphones but also a host of opportunities which it brings. From employment to investment and from export opportunities to local capacity building, it carries immense potential,” said Mr Tabba.
The report stated that pandemic, lockdowns, and the subsequent closure of schools impacted 201 million students worldwide. Out of these, 170 million students had no access to education for the past one year.
Based on minimum wage levels, a new report from Grover.com estimates it would take 6,639 hours for a Venezuelan to earn enough for the prized smartphone and 3,254 hours for an Indian. Chinese people must work 680 hours to make enough money.
1642 Hours in Pakistan
1791 Hours in Indonesia
3254 Hours in India
2045 Hours in Egypt
Minimum Monthly Wage levels in selected countries:
Sri Lanka: $247
Solomon Islands: $213
The Southeast Asia-Middle East-Western Europe 6 (SEA-ME-WE 6) is a 19,200 km-long submarine cable system connecting Pakistan with multiple countries between Singapore and France. SEA-ME-WE 6 will offer one of the lowest latencies available between Southeast Asia, the Middle East, and Western Europe, transferring more than 100 Tbps, the equivalent of 40,000 high-definition videos each second.
The SEA-ME-WE 6 consortium includes Trans World Associates, Bangladesh Submarine Cable Company, Bharti Airtel Ltd. (India) Dhiraagu (Maldives), Djibouti Telecom, Mobily (Saudi Arabia), Orange (France), Singtel (Singapore), Sri Lanka Telecom, Telecom Egypt, Telekom Malaysia and Telin (Indonesia).
Speaking on the occasion Mr. Kamran Malik, President of Transworld said:
“To meet ever increasing demand of bandwidth and to play a pivotal role in the forthcoming era of 5G, Transworld has joined the SEA-ME-WE 6 consortium, to build the latest state of the art high-capacity submarine cable system.”
SEA-ME-WE 6 will have more fibre pairs and more than double the capacity as compared to previous SEA-ME-WE cables.
SEA-ME-WE 6 provides an additional layer of diversity and resilience for the high traffic density route between Asia and Europe, strengthening the overall network of each consortium partner, through trans-Egypt’s new geo-diversified crossings and landing points.
The Southeast Asia-Middle East-Western Europe 6 (SEA-ME-WE 6) consortium announced today that construction has commenced on a 19,200 km-long submarine cable system connecting multiple countries between Singapore and France. SEA-ME-WE 6 will offer one of the lowest latencies available between Southeast Asia, the Middle East, and Western Europe, transferring more than 100 terabytes per second, the equivalent of 40,000 high-definition videos each second.
The SEA-ME-WE 6 consortium includes Bangladesh Submarine Cable Company, Bharti Airtel Ltd. (India) Dhiraagu (Maldives), Djibouti Telecom, Mobily (Saudi Arabia), Orange (France), Singtel (Singapore), Sri Lanka Telecom, Telecom Egypt, Telekom Malaysia, Telin (Indonesia), and Trans World Associates (Pakistan).
Pakistan has taken steps to address the outstanding concerns of Chinese investors, says Khalid Mansoor
By Mehtab Haider
Pakistan has received commitments from China for getting investments of $10-$15 billion for various sectors, including for establishing industrial units at 2,200 acres of Gwadar Free Zone, exploring the possibility to establish oil refinery at Pasni and relocation of industries into seven important sectors, including textile, footwear and pharmaceuticals into upcoming the Special Economic Zones.
Adviser to Prime Minister on CPEC, Khalid Mansoor, on Monday said that Pakistan took steps to address the outstanding concerns of Chinese investors such as payment of dues to independent power producers, making revolving funds functional and changing Special Economic Zones (SEZ) Act. This change in SEZ Act will pave the way to bypass 37 approvals for federal and provincial governments for making investments in SEZs.
"The government has paid Rs50 billion to IPPs while another installment of the same amount will be given by the end of the ongoing month. The Revolving Fund has been made functional," PM's Adviser on China Pakistan Economic Corridor (CPEC) Khalid Mansoor said while addressing a news conference here on Monday. The Pakistani delegation under PM Imran Khan had returned from China after attending Olympics Winter 2022 and on the sidelines, they held meetings with Chinese leadership, including President Xi Jin Ping.
However, both sides could not make the progress on the much-awaited multi-billion-dollar project for the construction of Mainline-1 (ML-1) to upgrade the rail line from Peshawar to Karachi. The official sources said that the resolutions of outstanding concerns, including repayments for IPPs and making Revolving Fund functional, would result in paving the way for achieving progress on striking financing agreement on ML-1.
Meanwhile, Federal Minister for Planning and Development Asad Umar told The News on Monday that the prime minister held meetings with 19 Chinese companies, inviting them to invest in Pakistan. He said that they shared the detailed documents with Chinese authorities on investment potential and comparative advantage of Pakistan in seven sectors, including textile, pharmaceutical, automotive, information technology, footwear, furniture, and agriculture.
A consortium of three Chinese companies Huazhong Technology, China Communication Construction Company (CCCC) and Zhejiang Seaport Company will set up a paper and metal recycling Park at Gwadar, which will include multiple units at an estimated cost of $4.5 billion. The park is expected to create 40,000 employment opportunities.
A Chinese textile company will establish a Special Economic Zone, which will be a Chinese textile cluster, with an investment of USD250 million.
Three Chinese companies, SINOMACH, Royal Group and Zhengbang Group, have expressed interest in investing in agriculture sector projects, such as FMD free zones, agricultural mechanization, production of pesticides, poultry and cattle feed, etc.
In information technology sector, five Chinese companies have expressed intent to invest around USD2.4 billion. These include Hunan Sunwalk Construction Group (optic fiber network), Fourishtech (research lab and mobile phones assembling and parts manufacturing) and Neusoft Medical Systems (medical diagnostic equipment); Global Semiconductor Group (semiconductor testing and assembly); NAV E-Vehicles (Pvt) Ltd (electric vehicles). MoUs have already been signed for the first two projects.
In the energy and water sectors, two large Chinese companies, China Energy Group and Power China, expressed interest for investment in water sector projects. In the housing sector, three Chinese companies, China State Construction Engineering Corporation (CSCE), China Railway Group Limited and CHINAMEX have expressed interest in implementing various projects.
Pakistan business leader Javed Afridi says he is in talks with Apple to bring an iPhone assembly plant to the country.
Afridi made the revelation on Twitter in response to a question from journalist Shiffa Yousafzai:
Afridi is best known as the owner of Pakistan's MG JW Automobile, and the CEO of Haier & Ruba. He is also the chairman and owner of Pakistani T20 cricket franchise Peshawar Zalmi. Haier is a leading Pakistani supplier of home appliances and tech including laptops and LED TVs.
The murmurings could be reminiscent of a similar deal Apple did in India in order to onshore iPhone assembly in the country there. Like India, iPhones and other Apple products sold in Pakistan are subject to high import tariffs if they aren't made locally, driving up the price.
If Apple was able to set up some form of manufacturing it could reduce the impact of these tariffs to make its best iPhones more affordable and accessible in the country. Apple saves around 22% on import duties by making its phones in India instead of importing them. It would also help Apple reduce its reliance on its supply chain in China, a weakness highlighted by the pandemic which saw heavy disruption to supply in the early part of 2020. Like India, Apple could also consider using phones made in Pakistan for export as well as the local market.
Apple announced its new iPhone SE earlier this week, featuring 5G and the A15 chip from the iPhone 13, a great budget option at just $429.
In the month of April, the units manufactured/assembled 2.56 million mobile phones against 0.25 million imports. In 2021, Pakistan has manufactured/assembled 24.66 million mobile phones locally as compared to 13.05 million in 2020.
The country also witnesses a decline in the imports of mobile phones. In 2021, the country imported 10.26 million mobile phones compared to 24.51 million in 2020.
Among the 9.72 million mobile phones, 5.69 million are 2G and 4.03 million are smartphones. According to PTA data, 53 % of mobile devices are smartphones and 47 % are 2G on the Pakistan network.
Although the industry has seen significant growth in mobile phone production, still we are lagging behind in some terms. For instance, Pakistan imported mobile phones worth $1.810 billion during the first ten months (July-April) of 2021-22 compared to $1.684 billion during the same period of last year, registering a growth of 7.43 per cent.
According to the Pakistan Bureau of Statistics (PBS), the overall telecom import increased by 14.05 per cent from (July-April) 2021 to 22.
A number of smartphone companies, including Samsung, have set up assembly plants in Pakistan in the past year. But this nascent industry is facing local challenges.
Along a dusty pot-holed road in Korangi industrial estate, one of Karachi’s designated factory zones, sewage runs in open drains, rag pickers collect plastic bottles, and car mechanics sweat at makeshift workshops.
It’s a June day with a temperature topping 35 degrees Celsius. Tempers flare up easily. Trucks loaded with textiles and chemicals zoom past, leaving a cloud of dust in their wake.
Incessant and prolonged electricity breakdowns mean many factory workers are sleep-deprived. Few can afford to lose daily wages in Pakistan, where the government struggles to bring in much-needed foreign investment to stabilise its fragile economy.
But amid this chaos, men and women donning blue and pink coats and special slippers walk through a passageway of one of the factories where a ventilation system blows dust specks off their clothes before they enter a long corridor flanked by different workstations. This is where Premier Code, a Pakistani company, manufactures smartphones.
“We need to be very careful about the environment in which we work. Karachi’s weather is different. There’s a lot of dust. So we make sure everything is clean. Our workers are not even allowed to bring water bottles where the phones are assembled,” says Nauman Amjad, the factory manager.
“We import parts from China and then assemble them here. But we have our own SOPs (Standard Operating Procedures), which employees follow to put the components together,” he tells TRT World.
Workers skillfully attach charging jacks and cameras to the motherboard as the phones — known as Dcode in the market — move along the assembly line. Plumes of cold air seep out of air humidifiers placed at various workstations.
Just a few years back, all mobile phones in Pakistan were imported. That changed two years ago when the then-government introduced a policy incentivising local assembly of the phones via tax rebates and other measures.
In 2021, local manufacturers produced 24.66 million handsets and imports drastically decreased, according to the Pakistan Telecommunication Authority (PTA), the industry regulator.
Samsung, the world’s largest smartphone maker, now assembles all its top brands, except for the foldable Z-Series, locally.
Local manufacturing and contract assembly mean Islamabad can slow the drain on its foreign exchange reserves. Pakistanis spent more than $2 billion on importing cell phones last year.
A high import bill and debt repayments have depleted official coffers and forced policymakers to try and negotiate a loan with the IMF.
With more than 114 million 3G and 4G subscribers, Pakistan has a large young population hooked on apps like TikTok and PUBG, which has increased the demand for smartphones.
Imposition of high tax on the import of mobile phone sets and tax rebates for local assembly has encouraged investment, according to industry professionals.
The PTA has issued licences to more than two dozen companies to assemble phones for the domestic market.
Contract manufacturing, wherein large brands such China’s Xiaomi outsource the assembly of phones to companies in countries like Vietnam, is not new.
Vietnam has emerged as one of the leading countries in the assembly and export of smartphones and other tech products in the past decade.
Apple recently moved part of its iPad manufacturing to Vietnam from China, where Covid lockdowns have disrupted supply chains.
“It’s only in the last five to seven years that the smartphone business has mushroomed in developing countries like ours,” says Quentin D’Silva, the head of Lucky's smartphone division, adding that smartphone usage has surged in the country following the introduction of 3G and 4G cellular services in 2014.
A matter of training
When D’Silva was helping set up the assembly unit in Bin Qasim, a special economic zone on the fringes of Karachi, he and his team had to follow Samsung's strict guidelines to uphold its manufacturing standards.
“My production manager, who worked for Reckitt Benckiser, visited a Samsung facility in Indonesia and he tells me they run it like a pharmaceutical company,” where extreme hygiene and cleanliness standards are maintained, he says.
A smartphone like Samsung’s S22 comprises thousands of intricate components such as chipsets designed and manufactured at sophisticated facilities in South Korea and a handful of other countries.
Putting the components together is the relatively easy part. Workers can be trained over a few weeks to follow the SOPs of Apple or Samsung correctly. Motor skills and speed are built gradually over time.
A bigger challenge in a country like Pakistan was changing the mindset of the nearly 700 people the company employs, says D’Silva.
“I’m not going to oversimplify the assembly part. But the training starts off with the concept of quality,” he asserts.
Customer satisfaction is a top priority for the South Korean tech giant and that means workers need to make sure the finished product is packed neatly without even a bubble of air or a speck of dust on its wrapping, he notes.
Samsung started production in Pakistan late last year and between January and May, 2022, it produced 1.2 million smartphones, including the S22 Ultra, the latest in the series.
Depending on the model, it takes workers between 13 and 18 seconds to put together a Samsung phone as it moves along an assembly line, according to D’Silva
"Our production drops if, for instance, our workers go for lunch and are 10 minutes late. That’s where the discipline comes in.”
Mobile phone assembly in Pakistan picked up its pace two years ago when the government increased taxes on smartphone imports. Simultaneously, the local industry was encouraged to import spare parts and assemble them domestically for the local market.
More recently, mobile phone imports have been banned as Islamabad tries to halt the rupee depreciation — one of the consequences of imports outweighing the revenue from exports.
Contract manufacturing generates employment and cuts down imports. But some local companies want to create brands and design their own products in the long run.
Premier Code says it’s investing approximately two to four percent of its revenue on research and development to gear up for the future.
“It’s not possible to localise production of all the components. Only a handful of companies make LCDs (the screens). Chipset manufacturing is primarily done in Taiwan, South Korea, Japan, the US and to a lesser extent in China,” says Muhammad Naqi, Premier Code’s CEO.
His company focuses on the design side of things, such as the layout of the printed circuit boards (PCBs), investing in proprietary software and the exterior look of the phones.
At the company’s factory, Dcode mobiles are subject to strict testing. Random samples are picked from each finished batch to undergo a durability test, which includes dropping spherical metal balls onto the phone’s screen and then dropping the device on the marble floor.
Naqi says his company is not a contract manufacturer. “We want to develop our own brand and products at the same time” — even if the components are shipped from elsewhere.
“But you need to understand that their layout is really big. When it comes to smartphones, it's a very small layout, which requires precision engineering. Our machines are not able to do that,” says Naqi.
High-tech machines used for making PCBs for mobile phones will mean higher capital costs and a thin factory workforce — undermining a vital goal of the government's policy, which is to create employment.
Nevertheless, a few tech companies are trying to challenge that view. One of them is located not far from Premier Code’s facility.
All about small steps
Elite Lighting manufactures parts for LED lights. Their products are nowhere close to the technologically advanced components that smartphone manufacturing requires.
But Yousuf Farooq, a young director at the company, has big dreams.
“Pakistan imports 100 million LED lights annually. It’s a huge market that we can capture,” he says.
Founded in November 2020, the company designs and fabricates PCBs for things like LED lights, watches and circuits that go into petrol pump dispensers.
“People were importing LED parts and putting them together here. We said, “Why don’t we build them here?”
At his 50-employee factory, workers place blue and black cylindrical components on the PCBs and solder them together. Known as ‘through-hole components’ such as resistors and capacitors, they are mostly imported from China.
But Farooq says his company can make them locally as the company grows and more orders come in.
“We started off by placing 9,000 components an hour on the PCBs. Now we can place 25,000 components. Almost all our workers were unskilled. We trained them over a period of 6 months.”
The Pakistani rupee’s depreciation, which has involved a 30 percent loss against the US dollar since July 2021, has made it feasible for local manufacturers to compete with importers.
LED light sellers pay their Chinese suppliers 60 to 90 days before the shipments arrive, says Farooq.
“Imagine if we can deliver the same product in 15 days and we deal in cash. So what has happened is that it improves the cash cycle of our customers.”
“Our customer can also just walk into my office and talk to me if something goes wrong. He doesn’t have to worry about learning Chinese,” he chuckles.
Rising wages in China have also made local manufacturers competitive. On average, Lucky and Premier pay between Rs30,00 and Rs35,000 (around $165) a month to their workers.
But the nascent industry is already facing a crisis. In recent weeks, banks have refused to extend credit which companies need to import components. That’s because of the fast-depleting foreign currency reserves that Islamabad is trying to preserve.
Lucky Motors, Samsung’s contract assembler, hasn’t been able to manufacture a single phone in almost a month.
“To say that Samsung people are upset is going to be an understatement,” says D’Silva, the CEO.
Pakistan imported mobile phones worth $1.978 billion during the fiscal year 2021–22 compared to $2.065 billion during the same period last year, registering a negative growth of 4.19 percent, according to the Pakistan Bureau of Statistics (PBS).
The overall telecom imports into the country during the period under review, i.e., fiscal year 2021–22, increased by 3.52 percent by going up from $2.593 billion in June–July 2020–21 to $2.684 billion during the same period last year.
On a month-on-month basis, imports of mobile phones into Pakistan decreased by 76.52 percent during June 2022 and stood at $32.221 million when compared to $137.213 million imported in May 2022, according to the PBS data.
Furthermore, on a year-on-year basis, mobile phones witnessed an 84.26 percent negative growth when compared to $204.677 million in June 2021.
On a month-on-month basis, the overall telecom imports into the country decreased by 52.80 percent during June 2022 and stood at $86.843 million, when compared to the imports of $183.985 million in May 2022.
Likewise, on a year-on-year basis, overall telecom imports witnessed 66.11 percent negative growth when compared to $256.255 million in June 2021. Other apparatus imports during July-June 2021-22 increased by 33.65 percent and stood at $705.945 million compared to $528.190 million in July-June 2020-21.
Other apparatus imports registered 16.78 percent growth on a month-on-month basis and stood at $54.622 million in June 2022 compared to $46.772 million in May 2022 and registered 5.90 percent growth when compared to $51.578 million in June 2022.
The Ministry of Information Technology and Telecommunication (MoITT) has launched three more projects of Optical Fiber Cable (OFC) worth Rs. 5 billion for six districts in Sindh.
The projects will provide high-speed connectivity to 4.2 million people in Larkana, Hyderabad, Badin, Qambar Shahdadkot District, Jamshoro, and Badin, and will be completed in 16 months. The contract for the projects was signed between the Universal Service Fund (USF) and Pakistan Telecommunication Company Limited (PTCL).Speaking at the signing ceremony, Sindh Chief Minister Syed Murad Ali Shah said in line with the vision of Digital Pakistan, the MoITT has been running diverse projects through the Universal Service Fund (USF). These projects are playing a huge role in the socio-economic development of the locals.
Federal Minister for Information Technology and Telecommunication Syed Amin uI Haque speaking at the occasion said that the ministry aims to connect all the citizens of Pakistan through the USF as digitalization has become a priority for businesses and communities.
Under its Next Generation Optic Fiber (NG-OF) Network & Services program, the USF has contracted over 16,000 km of OFC to benefit 31.5 million people across the country by providing access to information and e-suite services, such as e-healthcare, e-finance, e-agriculture, and e-education.
The minister added that the MoITT is enabling the rural and remote communities to compete better and support economic development for a positive impact on the national GDP while contributing to the United Nations Sustainable Development Goals (SDGs).
According to the Pakistan Telecommunication Authority, 14.08 million mobile phones manufactured during the first six months (January-June) of 2022, compared to 1.14 million imported commercially (PTA).
In June 2022, local manufacturing plants produced/assembled 1.67 million mobile phone devices. Local manufacturing facilities produced 24.66 million mobile phone handsets in calendar year 2021, up from 13.05 million in 2020, representing an 88 percent increase. According to PTA data, commercial imports of mobile phone handsets rose at 10.26 million in 2021, up from 24.51 million in 2020.
The 14.08 million mobile phones manufactured/assembled domestically include 8.06 million 2G and 6.02 million smartphones. According to PTA data, 54 percent of mobile devices in Pakistan are smartphones, while 46 percent are 2G.Overall telecom imports into the country surged by 3.52 percent over the time under evaluation, from $2.593 billion in July-June 2020-21 to $2.684 billion during the same period last year.
The effective implementation of the Device Identification Registration and Blocking System (DIRBS), in conjunction with supportive government regulations, such as the mobile manufacturing policy, has provided a favorable climate for mobile device manufacture in Pakistan.
It has also benefited Pakistan’s mobile ecosystem by minimizing the bogus device market, creating a fair playing field for commercial organizations, and building consumer trust through the development of standardized legal routes for all types of device imports.
Telenor is moving forward with its plans of selling its business in Pakistan, which is estimated at about $1 billion, reported Bloomberg today.
The Norwegian telecom giant in collaboration with the city Citigroup will invite bidders for the sale later this month, the sources disclosed to Bloomberg.
While we know that Telenor Pakistan is up for grabs for several years now, the challenge for the Norwegian operator is to find a viable deal, that could make business sense for the group and the shareholders.
We know that PTCL was in advanced talks with Telenor, but the outcome is yet to be seen. If Bloomberg is to be believed, then the development has taken its final shape at this point in time.
More recently the head of Telenor Group reaffirmed the plans for realignment of Asian operations, and it appears today’s Bloomberg report is around the same development.
ProPakistani reached out to Telenor Pakistan for the comment but it resorted to not to respond to speculations and rumors.
Back in July, Telenor had claimed that it would carry out a strategic review of its operations in Pakistan after spending $244 million in a struggling economy.
Bloomberg, without specifically mentioning anyone, said that entities based in the Middle East and Asia that are already working in Pakistan are expected to turn up in the bidding process later this month.
Talks are going on and the Norwegian telecom company is hopeful that they will lead to fruition.
The Ministry of Information Technology and Telecommunication is likely to launch 5G technology next year in the country to cope with the challenges of the digital world. The official of ministry of IT and telecommunication said that the provision of broadband services across the country was the topmost priority of the ministry of IT. He said that the ministry of IT through the Universal Service Fund (USF) had launched some 70 projects of optical fiber cable (OFC) and broadband infrastructure development in four provinces at a cost of Rs 65 billion. “All projects are underway in far-flung areas would be completed by June next year,” he added. “In the province of Sindh alone, 20 projects of NGBSD and OFC worth Rs16.3 billion have been started so far in 20 districts, including Tharparkar, Nawabshah, Khairpur, Larkana, Badin, Jacobabad, Shikarpur, Mirpurkhas, and Dadu,” the official said. He said that projects of connectivity of the un-served and underserved communities of Balochistan, Punjab, and Khyber Pakhtunkhwa (KP) provinces had also been launched. He said, through USF aimed to connect all the citizens of the country as digitalisation had become a priority for businesses and communities. Under its Next Generation Optic Fiber (NG-OF) Network and Services programme, USF had contracted over 16,000km of Optic Fiber Cable (OFC) to benefit 31.5 million populations across the country.
Jazz and Huawei have commercially deployed FDD (Frequency Division Duplexing) Massive MIMO (Multiple Input and Multiple Output) solution based on 5G technology in a large scale. The solution has been developed and tailored to the needs of boosting network capacity and user experience.
This customized solution has been the first launch of Jazz and Huawei, supporting Jazz leap into the 4.9G domain. This innovative solution has tremendously enhanced the network capacities along with superior 4G experience for the valued subscribers. The average network traffic increased by around 30% and the average single user speed increased by around 170%.
Jazz’s Chief Technology Officer, Khalid Shehzad said, “We see that our customers are increasingly using high-bandwidth applications which resultantly puts pressure on existing network capabilities. Massive MIMO essentially allows us the freedom to provide more data at greater speeds, enabling our customers to use the enhanced services on their existing 4G devices. Network speeds will be faster than ever, which will significantly improve the end-user experience. Jazz is committed to developing an ecosystem that supports the government’s Digital Pakistan vision and the evolving technology needs of individuals and businesses.”
Huawei provides the industry's unique intelligent beam scheduling and intelligent beamforming technology which are native for 5G. Massive MIMO improves the capability of the handsets to transmit more efficiently. Currently Huawei FDD Massive MIMO has been deployed in more than 70 networks and over 20,000 units have been shipped. The level of collaboration between Jazz and Huawei goes beyond to more domains. For example, the first 400G transmission, the first core network cloudification, the first large-scale commercial use of VoLTE, and the first 3G sunset city. In Pakistan, Jazz maintains a leading position in network performance and innovations, and it leads the development of the entire ICT industry.
A Nationwide Optical Fiber Cable Network Project has been signed between PowerChina and Hunan Sunwalk Group, according to Gwadar Pro on Friday.
Phase 1, Lot 1 of the said project will aim to improve Pakistan’s telecommunication infrastructure for better interconnection with its neighboring countries.
Talking to Gwadar Pro, business manager Sunwalk Group said that the company plans to spend several billion dollars on Pakistan’s Tier-2 and Tier-3 cities to establish telecom infrastructure and fiber industry.
The nation’s broadband adoption will be increased for the digital revolution, which will benefit not only the business-to-business sector but also the government, enterprise firms, and end consumers, the official added.
Previously, Sunwalk Group CEO Pakistan, Lan held a meeting with Federal Minister of IT and Telecom, Syed Amin ul Haque. Lan informed the Minister regarding investment plans for establishing a statewide optical fiber network and facilitating the growth of broadband in Pakistan.
He stated that his organization is prepared to invest approximately $2 billion over the next 8 to 10 years.
Every Pakistani broadband user consumed 81 GB of data in FY22, which showed double-digit growth of 11 percent as compared to the average yearly internet consumption which stood at 73 GB per person in FY21.
During the period under review, 8,970 petabytes of mobile data usage was reported in Pakistan, indicating a 31 percent increase from the previous year. Five years ago, mobile data usage in the country stood at 1,262 petabytes.
In a significant development for Pakistan’s IT and Telecommunication sector, Director of Global Licensing and Market Activation at SpaceX, Ryan Goodnight, called on the Federal Minister of Information Technology and Telecommunication, Syed Aminul Haq, to discuss the registration of SpaceX’s Starlink in Pakist
According to the Minister, Starlink has registered itself with the Securities and Exchange Commission of Pakistan (SECP).
The meeting was aimed at exploring how Starlink’s fastest and cheapest satellite internet services could pave the way for affordable broadband services in every corner of Pakistan.
The Minister expressed his optimism that Starlink’s services could significantly reduce the operational costs of telecom operators, even in remote areas where inactive mobile towers could be activated at low cost.
“Our main objective is to provide broadband services to every corner of Pakistan at affordable tariffs,” said the Minister, adding, “Starlink can play an important role in this regard.”
Ryan Goodnight thanked the Minister for his full cooperation and appreciated Pakistan’s progress in the IT and Telecommunication sector. “Basic steps are complete, and now we are ready to go fast,” Ryan added.
This development could potentially revolutionize Pakistan’s telecommunications industry by providing faster and more affordable internet services, even in remote areas. The successful implementation of Starlink’s services in Pakistan could be a significant step towards achieving the goal of a connected Pakistan.
The newly formed OneWeb/NEOM Tech & Digital JV will bring high-speed satellite connectivity to NEOM, Saudi Arabia, the wider Middle East and neighbouring countries including Pakistan.
The OneWeb/NEOM Tech & Digital JV has exclusive rights to distribute OneWeb services in these regions for seven years, and is expected to commence operations in 2023.
The OneWeb/NEOM Tech & Digital JV is looking to transform businesses and communities, stimulating enterprise across the region, with gateways and Points of Presence (POPs) in the Middle East providing security, speed and low latency data to sectors such as finance and retail, as well as schools and hospitals.
The JV says it will offer a seamless solution to infrastructural hurdles in Pakistan, where mobile operators and local loop operators will be able to leverage the service to expand their coverage areas, offering dependable low-cost internet access.
Matthew Johnson, Interim CEO of the OneWeb/NEOM Tech & Digital JV, said: “LEO satellites not only mean we can reach absolutely everyone everywhere, but with reliable and rapid speeds – connectivity at 100 megabits per second and more without the need for techniques such as trenching or placement of 5G equipment and fiber optics. This partnership with REDtone highlights how this technology presents an incredible growth opportunity for the wider region.”