ISLAMABAD: Pakistan’s telecom operators and mobile phone manufacturing industry have welcomed several measures announced in the Federal Budget 2026-27, describing them as positive steps towards promoting digital connectivity, investment and local manufacturing. However, industry stakeholders have urged the government to introduce additional reforms aimed at accelerating digital adoption and strengthening the country’s digital economy.
The Telecom Operators Association (TOA), representing major telecom operators in Pakistan, said the proposed reduction in customs duties on raw materials used for local handset manufacturing would help improve smartphone affordability and support the continued growth of Pakistan’s mobile manufacturing sector. The association also welcomed the rationalisation of the super tax, saying the move would contribute to a more investment-friendly business environment.
Despite these positive measures, the industry expressed disappointment that several key proposals submitted by the telecom sector were not incorporated into the budget. These included rationalisation of advance and withholding taxes on telecom services and mobile users, as well as a reduction in duties on optical fibre infrastructure required for broadband expansion and future digital connectivity needs.
According to the association, Pakistan currently has around 206 million mobile subscribers, while the number of active taxpayers stands at approximately 7.7 million. As a result, a significant portion of mobile consumers has no practical mechanism to reclaim taxes deducted from their telecom usage.
Industry representatives stressed that telecom infrastructure serves as the backbone of Pakistan’s digital transformation, enabling financial inclusion, e-commerce, education, healthcare, agriculture and public service delivery. They noted that greater policy support for investment and network expansion would help accelerate the country’s transition towards a more connected and competitive digital economy.
TOA Secretary General Kamal Ahmed said policies that improve affordability, encourage investment and facilitate infrastructure deployment generate benefits across the wider economy by supporting innovation, productivity and sustainable economic growth.
The association also welcomed the government’s recent decision to make Right of Way (RoW) for telecom infrastructure free of charge, describing it as a significant reform that would help reduce deployment costs, accelerate broadband rollout and improve connectivity across Pakistan.
Industry stakeholders expressed hope that the remaining proposals would be considered through continued engagement between policymakers and the telecom sector in the coming months, enabling Pakistan to fully realise the potential of its rapidly growing digital economy.
Special Report: Zubair Kasuri, Islamabad
