Pakistan is one of the largest consumer markets in the world when it comes to mobile phones, mostly smart phones. It is the world’s 7th largest importer of mobile phones with more than $500 million dollars of capital spent on it. Pakistan is not self-reliant in the mobile phones manufacturing industry because of lack of industrial machinery, raw materials and deficiency of technical expertise required for the process. As a result, Pakistan has ever increasingly been under immense financial pressure. A normal customer in Pakistan has to pay a tonne of taxes before getting the product in his hands. Keeping all these prospects in minds, The Economic Coordination Committee has approved first ever mobile phone manufacturing policy in Pakistan, in principle.
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Mission Of The Mobile Manufacturing Policy
The basic purpose of this policy, as explained by Ministry of Industries and Production, is that it will lead to a major financial boost for Pakistan as it will no longer be importing developed mobile phones from foreign countries. This will lead to self-reliance of our country when it comes to the availability of good quality mobile phones.
Another reason is the fact that such an endeavor will lead to the creation of 200,000 jobs minimum, because manufacturing industry cannot run without employing a large manpower for its projects. The unemployment rate in Pakistan is very high in Pakistan as compared to other countries and most of our youth that holds expertise in some sort of technical knowledge is unemployed. If Pakistan were to establish such an industry, hundreds of thousands of people will be employed for respectable jobs.
Once developed, Pakistan can also works its way through the localization of all products. National customers will be able to buy mobile phones much cheaper. Also, digitization and 4G/5G technology will be further expanded for convenience of nationals. Pakistan will also be able to generate its own revenue and profit once the developed mobile phones become good enough to establish a foreign market. Countries generate a major chunk of their finance from exports, and technological goods are something that have a never ending market.
However, establishing mobile phone manufacturing industries in Pakistan is going to be an arduous task. Even if we have just enough raw materials, industries will need to buy specialized machines for certain manufacturing operations which cost a very heavy amount. Also, special industrial complexes will need to be built along with the training of the employed workers working in them.
Key Points Of The Policy
The newly decided policy is quite elaborate, but here we will list down only the key points.
1. Regulatory Duty Tax for CKD/SKD manufacturing by Pakistan Telecommunication Agency for approved manufactures under IOCO approved quota, will be exempted.
2. Fixed income tax on CKD/SKD manufacturing of mobile phones up to $350 will be exempted.
3. Fixed income tax on $ 351-500 category and $ 500 on CKD/SKD manufacturing will be increased by Rs 2000 and Rs 6300 respectively.
4. Local industry will make sure that the localization of parts and components goes on as per roadmap.
5. EDB will act as Secretariat of Mobile Phone Manufacturing Policy and will ensure the development of allied parts, components, tools and devices.
This is the first ever mobile phone manufacturing policy in Pakistan and people are hopeful that it will work out.
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