Minister pleads reduced tax rates for telecom sector, mobile handsets

ISLAMABAD: Federal Minister for Information Technology and Telecommunication Syed Aminul Haque pleaded reduced tax rates for the telecom sector, mobile handsets, as well as industry-friendly and low-priced 5G auction to achieve the target of entrepreneurial innovation, productivity and economic growth through digital Pakistan vision.

“We seek incentives including tax rationalisation for mobile handsets, but the Ministry of Industry opposed it,” said the minister, adding that earlier, the Finance Ministry, the Federal Board of Revenue (FBR), and the State Bank of Pakistan (SBP) were supportive of the telecom sector, but now they had also started realising its potential and critical role in steering the country through economic challenges.

Talking to a select group of journalists, the minister said Pakistan Telecommunication Authority (PTA) had been asked to initiate the process of hiring consultants for the 5G auction. The launch of the 5G auction is also being made part of the Special Investment Facilitation Council (SIFC) and would be carried out in consultations with all the stakeholders.

The minister admitted that economic challenges, floods, and issues in opening letters of credit (LCs) as well as an increase in tariffs by cellular companies affected the sector growth as well as resulted in degradation of services.

“We asked the government for facilitation and not for a single penny investment to realise the potential of the sector,” said the minister, adding the IT and telecom exporters’ remittances increased from $1 billion to $2.62 billion during his tenure, at a time when exports of other ministries went down. It would have exceeded the current figure, if they did not face LCs restrictions, besides political and economic challenges.

The minister enlisted the achievements during his tenure while saying that “Made in Pakistan”, by starting mobile manufacturing in the country was a matter of pride, which creating hundreds of thousands of jobs by bringing international companies including Samsung, Nokia, and others to the country, adding “now, we are targeting to rope in Apple.”

Around 83 projects worth Rs77.8 billion would be completed by December 2023 under the Universal Service Fund (USF) to provide connectivity to remote and unserved areas across the country. The efforts had resulted in an increase in the USF spending from Rs15 billion to Rs77 billion during his tenure, demonstrating the government’s commitment to bridge the digital divide.

Haque further said Pakistan’s largest Information Technology Park project in Karachi was launched with a cost of Rs42 billion to facilitate the fastest-growing IT sector in the metropolis. Further, the launch of 4G in AJK and GB was a big achievement, he added.

Regarding social media rules, he said that a committee headed by the law minister was finalising it in consultations with all the stakeholders. Haque said the MoITT was working on social media rules on priority and the framework had reached the final stage. The data protection bill was envisaged as business-friendly with no compromise on national security and interest.

He further said that the number of National Incubation Centres (NIC) has been increased to eight.

Copyright Business Recorder, 2023