Mobile phone manufacturers seek favorable policies to boost production

ISLAMABAD: Pakistan manufactured 14.08 million mobile phones from January to June 2022, while 1.14 million mobiles were imported during the same period.
According to data released by Pakistan Telecommunication Authority (PTA), Pakistan assembled 1.67 million mobiles in June 2022 compared to 2.69 million mobiles manufactured in May 2022, a decline by 37%.
Data shows that Pakistan imported 200,000 mobiles in June 2022 compared to 80,000 units in April 2022, a growth of 150%. During the first six months of the current year, Pakistan assembled 6.02 million smart phones, while 8.06 million 2G mobiles were manufactured from January to June 2022.
Talking to WealthPK, Chairman of the Mobile Phones Importers and Manufacturers Association (MPIMA) Muzaffar Hayat Paracha said the Government of Pakistan has recently made amendments to its import policy to curb pressure on forex reserves. He said these amendments put a detrimental effect on the mobile device manufacturing industry which is still in its infancy.
“We are key stakeholders in Pakistan’s mobile phones industry ecosystem. We fully acknowledge the current fiscal problems being faced by the country, and fully support efforts by the government to boost forex reserves,” Muzaffar said.
He said that State Bank of Pakistan (SBP) has directed the authorized dealers to seek prior permission from foreign exchange operations departments. The SBP before initiating transactions for import of goods lists mobile companies in its circular.
“We request the government to take steps to remove these unnecessary conditions on import of SKD (semi knocked down) mobile devices in order to protect the mobile manufacturing industry, and to save employment of thousands of workers associated with it,” the MPIMA chairman said.
Muzaffar urged the government to ensure issuance of a statutory regulatory order (SRO) for drawback of local taxes and levies (DLTL) scheme. The DLTL was approved by the Economic Coordination Committee (ECC) of the cabinet on March 20, 2022 and ratified by the cabinet on April 02, 2022. Reportedly, 5% drawback has been agreed under the said scheme.
“It is proposed that an SRO might be issued in this regard. Local taxes are approximately 5%, which include sales tax, provincial taxes and duty on batteries, as batteries are not considered in SKD parts,” Muffazar said.
He said the MPIMA, being a representative body of around 80% of the key players from the mobile phone importers and manufacturers of the country, has sent a letter to the finance minister to resolve mobile industry problems.
He said the MPIMA and its members have played a significant role in development of mobile phone and allied products sector of Pakistan which includes preparation and implementation of device identification, registration and blocking system (DIRBS) and formulation of Pakistan’s first mobile device manufacturing policy.