Pakistan Takes a Giant Leap: Approves First Locally Mobile Devices Manufacturing Policy
The Economic Coordination Committee (ECC) has given a significant boost to Pakistan’s economy by approving the country’s first mobile device manufacturing policy. This landmark decision is expected to revolutionize the telecommunications sector, create employment opportunities, and promote economic growth.
Background and Objectives
The policy was drafted in January 2019 by the Engineering Development Board (EDB) and has been designed to achieve several key objectives. These include the acquisition and localization of mobile devices through local investment, joint ventures, and foreign direct investment. The policy aims to create 200,000 direct and indirect jobs, reduce prices for consumers, increase digitization by supporting 4G/5G technologies, and develop an efficient ecosystem for manufacturing and exporting competitive mobile phones.
Key Clauses of the Policy
The policy outlines several important clauses, including:
- Exemption of legal tax for the production of Complete Knockdown (CKD) and Semi Knockdown (SKD) units for approved manufacturers within the quota approved by the Input Output Coefficient Organization (IOCO).
- Exemption of fixed income taxes on CKD/SKD cell phone production up to $350.
- Fixed taxes of $2000 and $6300 for CKD/SKD production between $351-500 and above $500, respectively.
- The local industry will ensure that parts and components are produced according to the roadmap.
- The EDB will act as the secretariat for the mobile phone manufacturing policy and develop related parts, components, tools, and equipment.
Benefits and Impact
The production of CKD/SKD mobile units in Pakistan is expected to create a significant number of jobs across the country. This will not only boost employment opportunities but also contribute to the country’s economic growth. As the seventh largest importer of mobile phones, according to the Pakistan Telecommunication Authority, localizing mobile phone manufacturing can help promote much-needed economic growth.
Challenges Ahead
However, building a mobile phone industry in Pakistan will be a challenging task. The industry will need to acquire raw materials, purchase special machines for specific production activities, and build special industrial complexes. Additionally, workers will need to be trained to meet the requirements of the industry. Despite these challenges, the approval of the mobile device manufacturing policy is a significant step towards promoting economic growth and development in Pakistan.
FAQs
Frequently Asked Questions about the mobile device manufacturing policy:
- Q: What are the main objectives of the mobile device manufacturing policy?
- A: The main objectives include the acquisition and localization of mobile devices, creating employment opportunities, reducing prices for consumers, and increasing digitization.
- Q: What are the key clauses of the policy?
- A: The policy outlines several key clauses, including tax exemptions, fixed taxes, and the development of related parts and components.
- Q: What are the benefits of the policy?
- A: The policy is expected to create employment opportunities, promote economic growth, and reduce prices for consumers.
With the approval of the mobile device manufacturing policy, Pakistan is poised to take a significant leap forward in the telecommunications sector. As the industry begins to take shape, it is expected to have a positive impact on the country’s economy and create new opportunities for growth and development.
