EDITORIAL: Nearly six years after the introduction of the much-hyped Device Identification, Registration and Blocking System by the Pakistan Telecommunication Authority (PTA), which was intended to improve the telecom sector by blocking the use of smuggled and stolen smartphones, and thereby boosting tax collection on these devices, the national exchequer still faces substantial losses due to widespread smuggling of these products.
Disturbingly, the burgeoning e-commerce industry appears to have emerged as a key enabler for the illicit trade of smartphones.
As highlighted by a report in this newspaper, some of the country’s foremost e-commerce platforms are reportedly involved in facilitating the trade of expensive non-PTA-approved, smuggled smartphones, allowing consumers to buy these devices from online sellers without having to pay taxes on them, and that too with six-month warranties, potentially causing hundreds of millions in revenue losses to the government. Quite shockingly, even certified stores for respected names like Samsung and Apple are purportedly selling non-PTA-approved devices, with there being little check on these trading activities by the relevant authorities.
While major e-commerce platforms claim to “have strict policy guidelines for sellers”, which are supposedly only allowed to sell products after proper verification of their business details to ensure their authenticity, it is clear that when it comes to the sale of expensive smartphones, money-making considerations are overriding the law of the land.
Here, the FBR deserves much opprobrium in allowing this situation to fester. Its neglect of its responsibilities in putting a stop to such illicit trade, either because of its incompetence or complicity, or both, has allowed e-commerce websites and smartphone sellers to continue such activities without fear of legal action.
It would be pertinent to note that every department within the FBR, including the Inland Revenue Service and Customs, has established anti-smuggling units. One wonders what the point of spending valuable financial resources on manning these entities is and what the personnel staffing them are busy doing if smuggled smartphones are openly being traded online. Valid questions arise regarding the ability of the FBR and its various arms to meet the challenges posed by the digital age, highlighting the need for comprehensive reforms and adaptation to modern technological advancements.
One would also like to recall that this newspaper had reported in December 2023 that the federal government had detected a nationwide network of mobile phone smugglers and dealers, who allegedly had support of officials from various departments, including the FBR, FIA, Police, FC and PIA, for their nefarious undertakings. It is clear that little substantive action has been taken since then to weed out corrupt elements from these departments, with smuggling of smartphones continuing unabated. If there was ever any doubt regarding the pernicious impact that corruption within our government departments has had on various aspects of public life, including on our economy, such headlines are enough to dispel them.
What is needed forthwith is a crackdown on the sale of smuggled smartphones on e-commerce platforms through enhanced monitoring by regulatory bodies and law enforcement agencies, strengthening of policies prohibiting the online sale of such devices with clear consequences for violators, including for e-commerce websites and sellers, and ensuring transparency in transactions through provision of mechanisms for reporting suspicious listings or sellers. Most importantly, the capacity of government departments, including the FBR, to take on crimes of a digital nature clearly needs improvement, along with widespread reforms that aim at rooting out corruption from these bodies.
The state of our economy does not allow for the authorities to tolerate the unrestricted trade of smuggled smartphones. It is essential that they take decisive action to combat this illicit activity and safeguard the integrity of the online market space and government revenue.
Copyright Business Recorder, 2024
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