Pak­istan tops Asian tele­com users and in­vest­ment

The Pak Banker - - 6BUSINESS -

Pak­istan tops the South Asians as tele­com users, and as an in­vest­ment desti­na­tion, sev­eral mul­ti­lat­eral in­sti­tu­tions and the World Bank this week said. Pak­istan is lead­ing the re­gion in e-com­merce, dig­i­tal fi­nance and branch­less bank­ing, as the cam­paign for the ex­pan­sion of the Na­tional Fi­nan­cial In­clu­sion Strat­egy goes ahead.

An in­tense use of mo­bile tele­phony, and a range of sev­eral other equip­ment goes on, mov­ing into most of the com­mer­cial, busi­ness, in­dus­trial, education, and news me­dia sec­tors. This sweep is clearly seen from the shores of the Ara­bian Sea, next door to the United Arab Emi­rates, to the Hi­malayan heights and K-2 peaks in the ex­treme north of Pak­istan. In those snow clad re­gions, home to the world's tallest moun­tain peaks, e-com­merce sights and busi­nesses are now spring­ing up fast. Their In­ter­net sees ven­dors busy sell­ing fancy Pak­istani hand­i­crafts to sites as far away as Ger­many, Nor­way and Ja­pan.

This mas­sive trans­for­ma­tion of the tele­com and IT users goes on while Pak­istan is the num­ber one in­vest­ment desti­na­tion for for­eign in­vestors. This mar­ket is swiftly chang­ing to one us­ing all va­ri­eties of mo­bile tele­phony, tele­com and ICT re­lated ser­vices and prod­ucts. Along­side th­ese de­vel­op­ments, the sis­ter in­dus­tries in­clud­ing pro­duc­tion and as­sem­bly of com­put­ers, lap­tops and a wide range of IT equip­ment is also mov­ing up. Th­ese pro­duc­tion ac­tiv­i­ties will ex­pand fur­ther as the govern­ment is con­sid­er­ing var­i­ous pro­pos­als to cut down cur­rent taxes, and pro­vide sev­eral other con­ces­sions. In­cluded in th­ese pro­posal are the ones sub­mit­ted by the Pak­istan Com­puter As­so­ci­a­tion (PAC). PAC has pro­posed a with­drawal of some taxes and levy­ing of fixed cus­toms du­ties and taxes on IT prod­ucts.

"Our pro­pos­als will en­cour­age le­gal im­port of IT prod­ucts, re­move taxes re­lat­ing to the Gen­er­al­ized Scheme of Pref­er­ences. It will pro­vide the IT in­dus­try a level play­ing filed, re­duce con­sumer prices, and cut down large scale smug­gling," says PCA chair­man, Mu­nawwar Iqbal. "If the govern­ment agrees to levy a fixed tax on each IT prod­uct, it will bring Rs5.5 bil­lion a year in the form of new rev­enue." Ab­dul Rauf Alam, pres­i­dent of the Fed­er­a­tion of Pak­istan Cham­bers of Com­merce & In­dus­try (FPCC&I) says: "The com­puter in­dus­try in Pak­istan plays a sig­nif­i­cant role in the de­vel­op­ment and progress of the over­all econ­omy. The prob­lems be­ing faced by PCA and other sec­tors of the pri­vate sec­tor are be­ing dis­cussed with Fi­nance Min­ster Ishaq Dar, who is busy pre­par­ing the bud­get and the tax pro­pos­als for the Na­tional Bud­get for 2016."

The bud­get will be un­veiled in June. Mean­while, the World Bank Group and its 25 as­so­ciates in the pro­gramme to reach Uni­ver­sal Fi­nan­cial Ac­cess -2020, of which Pak­istan is a mem­ber, re­ported that "around six per cent of adults in Pak­istan have mo­bile ac­counts as com­pared to South Asia's av­er­age of less than 2.6 per cent."

Pak­istan also has a for­mal and reg­u­lated trans­ac­tion ac­count. It opens ac­cess to other fi­nan­cial ser­vices such as sav­ings pay­ments, in­sur­ance and credit, all of which can help peo­ple bet­ter man­age their lives and re­duce poverty. There are good prospects for both IT-mo­bile tele­phone ser­vices and bank­ing to move ahead hand-in-hand and en­joy tremen­dous growth in th­ese and other sec­tors, which is con­firmed by the sta­tis­tics.

The data in­di­cates that 13 per cent of Pak­istani adults have a for­mal ac­count. Less than five per cent of women are in­cluded in for­mal fi­nan­cial sec­tor. Some 27.5 mil­lion Pak­istani adults cite dis­tance to a fi­nan­cial in­sti­tu­tion as a bar­rier to open­ing a fi­nan­cial ac­count. At the same time 2.9 per cent adult Pak­ista­nis have a debit card. Al­ready, the tele­com sec­tor is go­ing up and up, be it in the im­port of equip­ment, new con­nec­tions, in­no­va­tive and art of the day tech­nol­ogy, its pri­vate use, or its ap­pli­ca­tions rang­ing from e-com­merce to bank­ing and fin­tech. The danc­ing num­bers are in mil­lions, the Pak­istan Tele­com Au­thor­ity (PTA), World Bank and in­ter­na­tional data sources say.

Broad­band sub­scribers have topped 26 mil­lion peo­ple, the PTA said. As such, the broad­band pen­e­tra­tion has gone up from three per cent to more than 15 per cent. The World Bank re­ports that a 10 per cent in­crease in high speed in­ter­net con­nec­tions can boost GDP by 1.38 per cent. The ar­rival of broad­band in Pak­istan is set to have a very pos­i­tive im­pact on its eco­nomic growth. All this shows just how fast and big the rate of div­i­dends and prof­its is to all in this busi­ness of mod­ern tele­coms, and why they should come and in­vest for­eign and do­mes­tic funds in Pak­istan.

Newspapers in English

Newspapers from Pakistan

© PressReader. All rights reserved.