All You Need to Know About the Mobile Phone Industry in Pakistan

Update (Dec 9, 2022): Click here for the latest update on the Pakistan mobile phone industry.

The beginning of the 21st century marked an unprecedented growth of the mobile phone industry in Pakistan. Over the last two decades, the number of mobile phone subscribers has swelled dramatically. According to a survey conducted by the Pakistan Telecommunication Authority (PTA) in March 2021, there are over 183 million cellular subscribers in Pakistan.

Pakistan — a Country with Over 183 Million Subscribers Using Imported Smartphones

The majority of people in the country are now smartphone users. A large percentage of these touchscreen phones are imported from other countries mainly South Korea, China, India, and the US.

Demand for Imported Smartphones in Pakistan Reaches a New Height

According to the latest statistics released by the Pakistan Bureau of Statistics (PBS), the demand for imported mobile phones in Pakistan has increased by a whopping 50.75% in the 2020-21 fiscal year. The total worth of these imports turned out to be around $2,065 million, which is huge money. 

Quick Fact: According to news sources, Pakistan is currently among the top 10 mobile phone importers in the world.

Government Slaps Heavy Regulatory Duties to Discourage Mobile Phone Imports in Pakistan

Due to the constantly increasing amount of goods being imported against the exports of the country, the trade deficit of Pakistan has gone over 30% (around $7.6 billion). It is not only negatively affecting the growth of the national economy but also hindering the progress of the local manufacturing sector. 

This is one of the biggest reasons why imports of mobile phones and other related technologies are discouraged by the federal government. According to an official notification released by the Federal Bureau of Revenue (FBR) at the beginning of the 2021-22 fiscal year, the regulatory duties on imported smartphones in the country have increased between 32% and 240%, making them pricier than ever before. 

This staggering increase in import tariffs is to bring down the demand for imported cellphones in Pakistan. Find complete details on the prices of imported smart phones with their respective duties in the table below:

The Rise of Locally Manufactured Mobile Phones

The trend of local manufacturing of cellphones in Pakistan has picked up pace over the last couple of years and things are expected to go to the next level in 2021. According to a report published in Gulf News earlier this year, about 1.21 million mobile phones were locally produced in the country in just the first two months of 2021.

Infinix, which has become one of the top-performing smartphone brands in Pakistan, is also manufacturing locally. In a bid to promote the “Made in Pakistan” trend, the government has already authorised 19 companies to produce cellphones locally.

According to a recent development, leading mobile phone brands and dealers like Vivo, Airlink, and Advanced Telecom are also putting in efforts to set up their manufacturing units in three big cities of the country: Karachi, Lahore, and Islamabad.

Is Samsung Mobile Division Coming to Pakistan?

Yes, it is finally happening! The Gulf division of Samsung Electronics, which is the South Korea-based tech giant,  is finally entering into an agreement with the Lucky Group of Companies to open its mobile phone production and assembly unit in Pakistan. This was confirmed by the Advisor to the Prime Minister for Commerce and Investment Abdul Razak Dawood in his latest tweet.

“Samsung has now agreed to come to Pakistan as a joint venture with their local partner Lucky Motor Corporation for producing Samsung mobile devices in Pakistan soon,” says Mr. Razak Dawood on Twitter.

After Samsung Mobile Division, Xiaomi — another world-famous cellphone brand headquartered in China — is planning to come to Pakistan. According to the latest news reports that came out earlier in July 2021, the Chinese company is expected to set up its mobile phone manufacturing plant in Pakistan within the next two to three months. The rise of “Made in Pakistan” mobile phones is also expected to greatly benefit the local export industry.

The Advent of 5G in Pakistan

The Covid-19 lockdown restrictions have made the concept of “work from home” more common than ever in Pakistan, thereby increasing our dependency on internet connectivity. While there are already many different types of 3G and 4G broadband internet devices in Pakistan, the trend of 5G technology has also started to pick up the pace.

In a recent development, PTCL has successfully completed 5G trials, transferring the internet data at a speed of up to 1.6 gb/s, The data transfer rate recorded in this 5G trial is the fastest in the history of the country.

The Ministry of Information and Technology believes that the successful implementation of 5G in Pakistan would help emerging technologies to prosper locally. The introduction of the new internet broadband aims for the country’s digital economic prosperity.

According to the experts, it would take at least five to seven years for the fully-fledged implementation and infrastructure development of 5G networks in Pakistan. Currently, 5G networks are only being tested under limited and non-commercial settings. This means that the development of 5G in the country is in its primitive stage and it would be too early to jump to any conclusion. To get all the latest updates on 5G in Pakistan, click here.

Latest Updates on the Mobile Phone Industry in Pakistan

Rapidly Increasing Market Share of Local Mobile Phones

The local manufacturing industry of cell phones is constantly growing. In just the past 10 months, Pakistan has produced 18.14 million devices. With the presence of incentivising policies for the manufacturers, the number of locally produced cell phones is expected to go further up down the road.

Due to the increasing share of local products in the market, mobile phone imports are declining. Data accumulated last year showed that the imports of mobile devices were recorded at 10.26 million in 2021, which was noticeably less than a whopping 24.51 million in 2020. The increasing scope of the industry could possibly create viable conditions for tech giants like Apple to start production in Pakistan. 

Record 50 Million Cell Phones Assembled in Pakistan in a Year

According to the Chief Executive Officer of the Engineering Development Board (EBD) Almas Hyder, the local production of mobile phones has crossed the 50 million mark in only a year and set a new record. Out of these 50 million devices, 22 million were smartphones while the rests were feature phones and bar phones. Over 90% of these locally manufactured devices have already been sold.

In addition, as of now, there are around 31 local and international mobile phone brands in Pakistan, some of which have already set up their manufacturing plants while others are in the phase of acquiring necessary licenses and permits to establish their production lines in the country, according to Almas Hyder.

Pakistan’s Industrial Progress: From Net Importer to Net Exporter of Mobile Phones

Pakistan jumped into the local manufacturing and export of different types of feature phones and smartphones recently with the government’s new taxation policies, which mainly revolved around the reduction of duties to boost the country’s telecom sector. Big names like Samsung and Xiaomi have already expressed interest in manufacturing in Pakistan and are targeting to produce millions of smartphones annually in their local manufacturing plants.

In partnership with Lucky Group, Samsung has already made its manufacturing plant operational, while on the other hand, Xiaomi is in talks with Select Technologies Pvt Ltd, a subsidiary of Air Link, to start its production in Pakistan. They have already been granted a manufacturing license by the Pakistan Telecommunication Authority (PTA).

On the account of all these noteworthy developments, the country’s telecom industry is undergoing a paradigm shift. The export of locally manufactured phones has picked up the pace, whereas the country’s import of such devices has significantly reduced recently. 

“In the second half of 2022, we will feature among established mobile phone exporters in the world,”  said the PM’s Advisor for Commerce and Investment Abdul Razak Dawood while talking in an interview with a renowned English daily.

Stay Tuned for More Updates!

There you have it — a detailed overview of the mobile phone industry in Pakistan and how things have been progressing in it lately. 

So, do you think the increase in locally manufactured smartphones could reduce our dependence on imported devices? Would this industrial growth also result in the generation of new employment opportunities for the locals? We’d like to hear your point of view on the subject. Feel free to write to us at blog@zameen.com.

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