The Reality of 5G Readiness in Pakistan

The introduction of 5G technology has the potential to revolutionize the digital landscape of Pakistan by offering unprecedented speed, connectivity, and opportunities for technological growth. However, despite its promise, Pakistan’s journey toward 5G has been fraught with challenges. The delays, high costs, and infrastructure inadequacies reflect deeper issues within the country’s telecom sector, raising questions about its readiness for this transformative leap.

A Long Road to 5G

Pakistan’s 5G story began with ambitious announcements in 2021 about launching the next generation of mobile connectivity. Initial plans were met with enthusiasm, but the actual implementation has been consistently delayed. These delays can be attributed to systemic problems, including high spectrum prices, unfavourable auction terms, limited fibre optic backhaul, and an underwhelming level of smartphone adoption.

According to the GSMA Mobile Connectivity Index 2023, Pakistan ranks the lowest in South Asia in terms of spectrum allocation. This lack of spectrum availability limits the country’s ability to deploy advanced technologies like 5G.

Challenges Highlighted by Telecom Operators

Telecom operators have repeatedly voiced concerns regarding the hurdles they face in Pakistan’s telecom ecosystem. Key challenges include:

1. High Spectrum Costs
   Spectrum prices in Pakistan are pegged to the US dollar, making them prohibitively expensive due to the ongoing depreciation of the Pakistani rupee. For instance, since the last auction in 2021, the dollar’s exchange rate has risen from PKR 163 to PKR 278—a staggering 70% increase. This sharp currency devaluation has significantly increased operational costs for telecom companies.
2. Spectrum Auction Inefficiencies
   Auction terms have often been rigid and unappealing. For example, in 2014, operators were required to buy less desirable spectrum to qualify for higher-demand bands. Additionally, some spectrum was reserved for new market entrants, but the failure to attract these entrants left large chunks of spectrum unused.
3. Inadequate Infrastructure
   A robust fibre optic backhaul is critical for 5G deployment, but Pakistan lags significantly in this area. Only 15% of the country’s mobile towers are fibre-connected, with the rest relying on less reliable microwave backhaul systems.
4. Low Smartphone Penetration
   While 62% of the population owns smartphones, only 1% of these devices are 5G-compatible. This low penetration rate is further hampered by high smartphone costs due to inflation and import taxes.
5. Stunted Innovation and Competition
   High spectrum costs and unfavourable terms discourage competition, limit innovation, and ultimately lead to higher prices for consumers.

Recommendations from Experts

The National Economic Research Associates Inc. (NERA), an international consultancy firm, has made key recommendations to address these challenges. It stresses that:

• Lower Spectrum Prices: Affordable pricing could stimulate competition and encourage long-term investment, ultimately benefiting consumers.
• Rupee-Based Pricing: Aligning spectrum prices with local currency would mitigate the impact of currency devaluation.
• Flexible Payment Terms: Extended payment plans, as seen in other countries like Vietnam and Bangladesh, could make spectrum acquisition more feasible for operators.
• Infrastructure Sharing: The recent approval of the Telecom Infrastructure Sharing Framework, which allows operators to share active and passive infrastructure, is a positive step but needs to be implemented more effectively.
• Increased Fiber Deployment: Government incentives to expand fibre networks are crucial for creating the foundation for 5G.

Current State of the Internet and 5G Readiness in Pakistan

Pakistan’s internet infrastructure remains underdeveloped compared to global standards. Broadband penetration is uneven, with urban areas significantly outpacing rural regions. Additionally, existing 4G networks are stretched thin due to limited spectrum availability, affecting service quality and further underscoring the need for 5G.

Currently, the whole country is facing slow internet speed due to the “Firewall installation”. Meanwhile, the government has also started a VPN crackdown in the country resulting in limited access to internet.

The government’s steps toward 5G readiness have been minimal. While policy-level changes, such as approving infrastructure-sharing frameworks, signal some intent, there has been little concrete progress. Without significant investment and reform, the rollout of 5G remains a distant dream.

See Also: Undersea Cable to Boost Internet Speeds: A Solution to Persistent Slowdowns?

Are We Ready for 5G?

The answer is, unfortunately, no. Pakistan is not currently prepared for 5G deployment. While the demand for faster, more reliable internet is growing, the country’s infrastructure, policy framework, and affordability challenges are major roadblocks. Even the telecom operators, who are key stakeholders in this transition, remain hesitant due to unclear policies and high costs.

The Way Forward

Pakistan’s aspirations for 5G can only materialize with a concerted effort to address these systemic issues. The government must:

1. Lower Spectrum Costs: Ensure reserve prices reflect market realities and are competitive with other countries in the region.
2. Promote Fiber Optic Deployment: Provide incentives for telecom operators to invest in fibre infrastructure.
3. Encourage Smartphone Adoption: Reduce taxes on smartphones and introduce subsidies for low-income groups.
4. Streamline Policy Frameworks: Resolve pending issues, such as spectrum litigation and merger decisions, to create a stable market environment.

Until these steps are taken, Pakistan risks falling further behind in the global digital race. For 5G to become a reality, the government and telecom operators must work collaboratively to overcome these challenges and ensure the benefits of this transformative technology reach all corners of the country.