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Economic Survey Report: Telecom Sector Growing in Current Fiscal Year!

  MPC Team

Report from the Pakistan Economic Survey

According to the recently published, Pakistan Economic Survey 2017-18, the most significant achievements of the current fiscal year have included the high paced rate in real GDP growth due to advancements in agriculture, manufacturing as well as in services.

The Telecom sector alone invested $ 322.9m during first two quarters of FY 2017-18 which is a significant figure. On the other hand, revenues from the telecom sector reached to Rs. 235.5bn during the same time period. Hence the sector has not only expanded steadily but has also hugely contributed.

Since the commercial launch of the 3G and 4G LTE services in the country, newer opportunities have become available for mobile operators to generate more revenue.

Ever since 3G and 4G LTE services have become available in the country, new applications and database services are being created. Moreover, the people of the country are gaining awareness of these new services and technologies and happily adapting to them.

Note: Figures for the FY 2017 and Jul-Dec 2018 are estimated.

Millions have been invested into the economy by telecom operators of the country during the first 2 quarters of FY 2017-18. Major contribution of US $267.94 was made by the cellular mobile sector during the first and second quarters of 2017-18.

The trend for the up-gradation of mobile networks for 3G and 4G services which started in FY 2012-13 continued to gain momentum and was the reason for the overall investment in the telecom sector.

Contribution by the Telecom Sector

The Telecom sector of the country has proven to be an important revenue resource for the national exchequer. During the first two quarters of the fiscal year 2017-18, the telecom sector contributed an estimated PKR 78.62 billion to the national exchequer in terms of taxes, regulatory fees, initial and annual license fees, activation tax, and other charges.

pakistan economy survey

Note: Figures for 2015-16 and Jul-Dec ’16 are estimated.

PTA’s contributions comprise of all its receipts including Initial and Annual License Fees, Annual Radio Frequency Spectrum Fee, Annual Spectrum Administrative Fee, USF and R&D Fund Contributions, APC for USF, Numbering Charges, License Application Fee, etc.

Others include custom duties, WHT and other taxes.

Source: Federal Board of Revenue and Pakistan Telecommunication Authority.

Statistics of Cellular Subscribers

The number of 3G and 4G LTE subscribers in the country was 42 million during June 2017 which increased to 48.19 million by the end of December 2017. This indicates that there have been more than one million new subscriptions per month for 3G and 4G LTE services.

Although the sector did face a setback due to the “Biometric re-verification” of SIMs in 2014 and 2015; which had an adverse impact, on the cellular subscribers of the country.

Even with the difficult circumstances prevailing, the industry surprisingly managed to survive through that tough period and now continues to get back the subscribers in high numbers and gained 147.5 million mobile subscribers by the end of February 2018.

Expanding coverage and reduced tariffs had a great impact on mobile phone prices in Pakistan and most importantly further increased the pace of 3G and 4G LTE subscriptions which stood at 51.2 million by the end of February 2018.

During July 2017 till December 2017, broadband subscriber base of Pakistan showed immense improvement. By the end of the year there were 50.51 million broadband subscribers whereas this figure was 44.59 million in the previous year. By the end of February 2018, the total number of mobile broadband subscribers, in Pakistan was 53.5 million.

The figures for Total teledensity in Pakistan were 72.7 percent at the end of the second quarter of fiscal year 2017-18 as compared to 72.5 percent at the end of last fiscal year. The teledensity percentage for February 2018 was 74.2 percent. Teledensity is determined by the overall increase in the mobile phone subscribers in Pakistan.

Conclusion

According to analysis by mpc.com of the figures reported by the Pakistan Economic Survey 2017-18, there has been immense growth in the telecom sector of Pakistan during the first two quarters of the fiscal year 2017-18. It clearly shows that awareness for cellular subscription and new mobile applications and technologies is ever increasing amongst the nation and a positive impact on mobile phone prices in Pakistan should be expected in the future.

 

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