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Lower Import Duties Rattle Pakistan's Mobile Handset Makers
Pakistan Federal Board of Revenue has recently announced that “Sales Tax and Income Tax at import stage has been drastically reduced in case of smartphones of Rs15,000 or below". This action was apparently taken after Digital Pakistan Initiative led by Tania Aidrus asked for it. It has come under fire from the country's nascent mobile phone and smartphone manufacturing industry which is producing low-cost mobile phones. Pakistan's mobile handset market is the 8th largest in the world. Current annual demand is for about 40 million units of which 13 million are assembled in Pakistan while the rest are imported, according to a report by Dunya News. The import bill for Fiscal Year 2020 is expected to be about $1.2 billion. Boosting it will save billions of dollars of precious foreign exchange. It will create tens of thousands of jobs and spawn new auxiliary manufacturing industries for chargers, headphones, USB cables, cases, etc. In future, Pakistan could become a significant exporter of mobile handsets.
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Mobile Phone Demand:
There are currently 164 million mobile phone users in Pakistan, the 8th largest in the world. The current annual demand for mobile phones in the country is estimated at about 40 million units, according to Pakistan Telecommunication Authority (PTA). The fastest growing demand is for 4G smartphones.
According to Pakistan Bureau of Statistics, mobile-phone imports (HS Code: 8517.1219) reached $498 million in 5 months period from July to November 2019, 64% jump over the prior year. Fiscal 2019-20 imports are expected to reach $1.2 billion.
Earlier, the growth rate for 4G handsets jumped from 16% in 2018 to 29% in 2019. Imports of mobile handsets soared 69% from $ 364 million in 2018 to $ 615.7 million in 2019. Pakistan is world's seventh largest handset importer and the 8th largest mobile phone market.
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Domestic Manufacturing:
Pakistan Telecommunication Authority (PTA) has granted permission to 26 local companies for manufacturing out of which 15 are currently in production. Among those currently producing mobile handsets in Pakistan are: E-Tachi, GFive, Haier, Infinix and Tecno. They are producing 13 million mobile phones.
Domestic manufacturers claim that they can meet 80% of demand for mobile handsets over the next 2 to 3 years if they are sufficiently protected by higher tariffs on imports.
Domestic mobile phone manufacturing industry will save billions of dollars of precious foreign exchange. It will create tens of thousands of jobs and spawn new auxiliary manufacturing industries for parts, chargers, headphones, USB cables, cases, etc. In future, Pakistan could become a significant exporter of mobile handsets.
Summary:
Pakistan's mobile handset market is the 8th largest in the world. Current annual demand is for 40 million units. Domestic plants produce 13 million units while the rest are imported. The import bill for Fiscal Year 2020 is expected to be about $1.2 billion. The country's nascent mobile handset manufacturing industry fears a serious early setback if the FBR decision to lower duties on imports of foreign made mobile phones is not reversed. It is being blamed on Tania Aidrus, Prime Minister Imran Khan's advisor on Digital Pakistan Initiative, who would like to increase availability of mobile handsets. Domestic mobile phone manufacturing industry will save billions of dollars of precious foreign exchange. It will create tens of thousands of jobs and spawn new auxiliary manufacturing industries for chargers, headphones, USB cables, cases, etc. In future, Pakistan could become a significant exporter of mobile handsets.
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Views: 924
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Comment by Riaz Haq on July 18, 2023 at 9:50am
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Pakistan Manufactured 4.88 Million Mobile Phones in First 5 Months of 2023
https://propakistani.pk/2023/07/10/pakistan-manufactured-4-88-milli...
The country imported mobile phones worth $516.488 million during the first eleven months (July-May) of the current fiscal year 2022-23, registering a negative growth of 73.46 percent when compared to $1.946 billion during the same period of last year.
Pakistan’s mobile phone imports increased by 308 percent on a month-on-month (MoM) basis in May 2023 and stood at $43.201 million compared to imports of $10.587 million in April 2023, according to data released by the Pakistan Bureau of Statistics (PBS).
Mobile phone imports registered 68.52 percent negative growth on a year-on-year (YoY) basis in May 2023 when compared to $137.212 million in May 2022.
The overall telecom imports into the country stood at $860.441 million during July-May 2023 and registered 66.87 percent negative growth compared to $2.597 billion during the same period of last fiscal year.
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Revenue in Pakistan Laptops market amounts to US$0.88bn in 2023. The market is expected to grow annually by 5.52% (CAGR 2023-2028).
In global comparison, most revenue is generated in China (US$23,250.00m in 2023).
In relation to total population figures, per person revenues of US$3.75 are generated in 2023.
In the Laptops market, volume is expected to amount to 1.54m pieces by 2028. The Laptops market is expected to show a volume growth of 2.5% in 2024.
The average volume per person in the Laptops market is expected to amount to 0.01pieces in 2023.
https://www.statista.com/outlook/cmo/consumer-electronics/computing...
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Pakistan - Country Commercial Guide
https://www.trade.gov/country-commercial-guides/pakistan-computers-...
This is a best prospect industry for this country. Includes a market overview and trade data.
Last published date: 2022-11-10
Overview
(US$ Million)
Table: Total Market Size
2019
2020
2021
2022* (Estimated)
Total Local Production
1.75
1.00
1.20
0.95
Total Exports
0.00
0.00
0.0
0.0
Total Imports
431.55
395.73
414.78
443.81
Imports from the US
53.20
46.55
48.17
52.98
Total Market Size
433.30
396.73
415.98
444.76
Exchange Rates
152.34
158.82
159.02
210.17
* Sources: Pakistan Economic Survey 2021-22, Ministry of Finance, Government of Pakistan
Pakistan Bureau of Statistics, Government of Pakistan
Local chambers of Commerce and Industry, Trade Essociations, and Market Experts
Despite the global pandemic and domestic macroeconomic challenges, Pakistan’s market for computers and peripherals has seen a steady growth trajectory during the last fiscal year. With virtually no domestic production, the country relies heavily on imports. The local market is generally receptive to U.S. brands, mainly due to the quality and reliability of their products; however, other foreign brands from Japan, South Korea, Malaysia, Taiwan, and China offer a strong competition. Major U.S. brands such as Dell, Hewlett Packard, Intel, Microsoft, and Cisco have established a strong presence in Pakistan.
The information technology (IT) in Pakistan has seen an overall healthy uptick in growth during the last year. Despite overall macroeconomic pressures, the computers and peripherals sector has retained its position as a major prospective sector for the U.S. companies. The public and private sectors in Pakistan place a high priority on the introduction, availability, and utilization of computers and other IT equipment in routine and critical workflows. The Government of Pakistan (GOP) through the National IT Policy emphasizes computer availability, usage, connectivity, and skills development. In addition, the GOP has launched several projects and incentive schemes to ensure a widespread availability of computers to the local consumers. Some of the initiatives include development of software technology parks; special technology zones; the provision of demand-based training; increasing internet penetration through multiple mediums including broadband, wireless broadband, and fiber optic; research and development; digitization of public-sector records, technology incubation centers; and training and skills development centers. According to industry expects, the demand of IT equipment related to cyber security sub-sector is also expected to grow by at least 3 percent in the next few years.
The primary users of computers and peripherals in Pakistan are private businesses; IT services companies, software development houses, call centers, Business Process Outsourcers (BPOs), internet service providers, public and private sector incubation centers, educational institutions, freelance developers, and private users. There are more than 3,000 IT and IT-enabled companies, employing over 100,000 qualified IT professionals in Pakistan. Software development, including specialized application development has emerged as a major business sub-sector during the last several years. According to the latest statistics, there are approximately 25,000 qualified professionals associated with this sub-sector and this number is expected to grow at an annual rate of 3-4 percent in the coming years.
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Technology
Xiaomi’s Local Partner to Start Selling TVs in Pakistan
Air Link aims to start assembling televisions in January
Mobile assembler also plans to ramp up mobile phone output
https://www.bloomberg.com/news/articles/2023-08-15/xiaomi-s-local-p...
By Faseeh Mangi
August 15, 2023 at 1:40 AM PDT
Pakistan’s Air Link Communication Ltd. plans to start assembling Xiaomi Corp. televisions in January to sell in the world’s fifth-largest nation.
The companies, which forged a partnership two years ago to sell mobile phones in Pakistan, don’t expect major investment will be needed since the assembly lines for both products are quite similar, Air Link CEO Muzzaffar Hayat Piracha said in an interview.
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https://propakistani.pk/2023/08/15/air-link-communication-to-start-...
Piracha said that Air Link has become profitable in the past six months. The company aims to raise mobile phone production to around 500,000 per month by the end of the year, up from 300,000 currently, he added.
Air Link, which began operations as a mobile phone reseller just over 10 years ago, became Pakistan’s largest private sector public offering when it was listed at PSX in 2021. It has since become one of the country’s largest smartphone distributors.
Pakistan has recently seen a slight uptick in the revival of business operations by foreign enterprises ever since the International Monetary Fund agreed to a new bailout program to revive the economy. The IMF demanded that the country remove all import restrictions, which has appealed to distributors like Air Link.
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Yousuf M.Farooq
@YousufMFarooq
Localization
Full speed ahead
LED Lights Made in Pakistan !
The industry started with just assembling SKD kits imported from China.
Now the PCB, MCPCB, the constant current power supply, plastic parts, metal parts, wires and packaging are now all being Made in Pakistan.
https://twitter.com/YousufMFarooq/status/1694184000137375825?s=20
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