Experts Seek Sharp Tax Cuts to Accelerate 5G Rollout in Pakistan

Telecommunications experts, policymakers, and industry representatives on Monday called for substantial tax reductions and a shift toward business-focused applications to ensure a viable rollout of 5G in Pakistan, warning that excessive taxation and weak industrial demand could slow the country’s digital transition.

The discussion took place at a seminar titled “5G Imperative in Pakistan: The Need for Comprehensive Infrastructure, Economic Readiness, and Digital Sovereignty,” organized by the Sustainable Development Policy Institute under its Study Group on IT and Telecommunication.

In his opening remarks, Brig. (R) Mohammad Yasin, Distinguished Advisor Emeritus at SDPI, described the upcoming auction of nearly 600 MHz spectrum as potentially the largest in Pakistan’s history. He termed it a structural transformation rather than a routine technological upgrade.

He noted that over 130 million broadband subscribers currently share just 274 MHz of spectrum—significantly below regional benchmarks. The forthcoming auction will include the 2,300 MHz, 2,600 MHz, and 3,500 MHz bands, with the 3,500 MHz band globally recognized as the primary spectrum for 5G deployment.

Dr. Muhammad Mukarram Khan, Director-General (Cyber Vigilance) at the Pakistan Telecommunication Authority, said the regulator must balance government revenues, operator sustainability, and consumer affordability.

He confirmed that the PTA is engaging with the Federal Board of Revenue to reduce handset taxes and related tariffs, acknowledging that high fiscal burdens are limiting smartphone adoption. He added that Pakistan ranks among the leading countries in ICT freelancer revenue, yet many freelancers rely on slow mobile broadband services.

The PTA is also working to improve internet resilience, diversify submarine cable connectivity beyond Karachi, and facilitate satellite internet services through multiple providers.

ICT consultant Parvez Iftikhar cautioned that 5G would not become instantly widespread and argued that retail broadband would not be its main driver. Instead, business-to-business (B2B) use cases—particularly in Special Economic Zones and Special Technology Zones—would determine its success.

He called for improved fiber penetration, tower outsourcing, and more realistic base pricing in spectrum auctions, citing international examples from South Africa and the Philippines.

Dr. Zainab Naeem of SDPI stressed regulatory clarity, investor confidence, and skilled human capital as prerequisites for 5G adoption. She said 5G could support Pakistan’s climate commitments, export competitiveness, and digital transformation goals if supported by evidence-based policy.

Aslam Hayat, Senior Policy Fellow at LIRNEasia, argued that Pakistan’s telecom policy since 2003 has focused heavily on infrastructure supply while neglecting demand creation.

He proposed government-led pilot projects, smart city initiatives, public safety networks, and tax relief on 5G equipment and IoT devices. He also recommended neutral host regulations, local content development, startup incubation, and measurable performance indicators beyond network coverage.

Fatima Akhtar, Head of ESG at Jazz Pakistan, described spectrum as a sovereign asset and highlighted device affordability as a “chicken-and-egg” challenge. She urged linking 5G deployment with employment generation and industrial use cases in agriculture, robotics, and manufacturing.

Hannan Tariq, Director of Strategy at the Universal Service Fund, outlined three key application areas: enhanced mobile broadband, low-latency services such as robotics, and machine-type communications for agriculture and industry. He said Pakistan would adopt a phased rollout, initially leveraging existing 4G infrastructure.

In concluding remarks, Dr. Sajid Amin Javed, Deputy Executive Director at SDPI, observed that while public finances remain constrained, private sector investment—particularly in health and education aligned with 5G—would be essential for achieving digital transformation.

Participants broadly agreed that without targeted tax reforms, industrial demand stimulation, and policy coherence, Pakistan’s 5G ambitions may struggle to translate into meaningful economic gains.

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