After receiving permission for imports, mobile phone manufacturing units in Pakistan have restarted their production, meeting up to 90% of the country’s demand. According to a report by the Dawn newspaper, statistics from the Pakistan Bureau of Statistics indicate that mobile phone imports from July to August 24-2023 have increased by 77% year-on-year, reaching $179.4 million.
Comments from the Pakistan Mobile Phone Manufacturers Association
Muzaffar Paracha, Senior Vice Chairman of the Pakistan Mobile Phone Manufacturers Association, stated that the ease in opening Letters of Credit for imports will help alleviate the shortage of mobile phones in the country. Within 2 months, locally assembled mobile phones will fulfill nearly 90% of the market’s requirements. He mentioned that almost all 30 mobile units, including three foreign brands, have resumed their operations and will produce more than 2 million mobiles.
Government Restrictions and Industry Challenges
The government had imposed restrictions on opening LCs due to a shortage of dollars, and almost all manufacturing units were shut down by the end of March. Association members said that currently, mobile phones worth approximately $7 million are being imported, but this only meets 10% of the market demand.
Insights from the Senior Vice Chairman of PMPMA
Amirullah Wala, Senior Vice Chairman of PMPMA, said that local mobile phone assemblers have produced 3.5 million sets in a month, including both smart and feature phones. He highlighted the monthly demand for nearly 3 million sets in the local market as people replace their phones, and many sets get damaged during use. Amirullah emphasized the need for Pakistan to be consistent in this regard so that related components, including chargers, batteries, hand-free, cables, etc., can be produced locally.
Appeal to the Government
Mobile manufacturers have urged the government to allow the import of components worth $170 million every month to run the industry at full capacity. Meanwhile, mobile telephony service providers have also emphasized the encouragement of local manufacturing of smartphones.
Views from Jazz’s Chief Executive Officer
Aamir Ibrahim, Chief Executive Officer of Jazz, commented that a digital revolution is unlikely in an environment where a significant portion of the population uses only 2G handsets. Responding to a question about the importance of local mobile phone assembly, he said it’s not beneficial for Pakistan to still largely import and promote non-internet phones. Aamir referenced statistics released by PTA, stating that from January 2021 to July 2023, Pakistan has locally produced 54.67 million handsets, of which only 20.8 million are smartphones.
Conclusion
The resurgence of mobile phone manufacturing in Pakistan marks a significant shift in the country’s technological and economic landscape. With the easing of import restrictions and the proactive stance of industry leaders, the nation is poised to meet a substantial portion of its domestic demand through local production. However, while the numbers are promising, challenges persist. The emphasis on 2G handsets in a world moving rapidly towards digital transformation underscores the need for a more forward-thinking approach. For Pakistan to truly harness the potential of this industry and ensure sustainable growth, a balanced focus on both quantity and quality, along with the promotion of smartphones and related technologies, is imperative.
