ISLAMABAD: The Chief Executive Officers of telecom companies are concerned about the telecom industry’s financial health, which according to them was severely impacted due to an unprecedented rise in the cost of operations.
The heads of four mobile cellular companies, during a meeting with federal minister for IT Syed Amin Ul Haque, have informed that the cost of doing business for the sector was increasing following rise in fuel, electricity and interest rates.
According to officials Aamir Ibrahim, CEO Jazz, Irfan Wahab Khan, CEO Telenor Pakistan and Hatem Bamatraf President and CEO Ufone had called on the minister on Thursday. The agenda of the meeting was to encourage the telecom sector to pursue the launch of 5G in the country.
During the meeting, as per sources, the three telcos expressed concerns over the lack of consistent government policies that was making it difficult for the companies to convince their investors regarding the potentials of further investments in Pakistan.
However, the CEOs expressed concerns that the telecom industry’s financial health was severely impacted due to an unprecedented rise in the cost of operations.
The telcos highlighted that the key components that have taken its toll on the cost of doing business was rise in fuel, electricity and interest rates, increased dollar rates while the government has pegged spectrum installments with the ‘green back’.
Expressing concerns over the launch of 5G within 12 months the heads of the telecom companies highlighted that the recent floods have severely damaged critical digital infrastructure.
The minister was even apprised that these conditions even threatened the survival of the telecom sector in Pakistan.
“To mitigate the ‘digital emergency’ like situation in Pakistan, urgent policy interventions from the government were needed to provide critically needed fiscal space to the telecom sector and support Pakistan’s digital inclusion objectives,” one of the CEOs told the minister.
One head of the telecom company suggested that the government should denominate spectrum payments in rupee terms and extend the payment terms to 10 years instead of 5 years, while there was a need to suspend industry’s annual contribution to the Universal Service Fund and Ignite for 2 years.
However all the three industry players demanded reduction in withholding tax from 15 to 8 percent on essential telecom services.
Whereas a day earlier, Wang Hua, CEO Zong held a separate meeting with the minister and expressed willingness to launch 5G technology in Pakistan in 2023.
Mr. Wang assured that not only Zong was ready to fully cooperate with the IT Ministry for the launch of 5G technology in the country, but also added that Zong would soon launch its microfinance application for e-commerce.
Later the minister assured that the ministry was aware of issues faced by the telecom industry in the country arising from various government departments.
The minister said that the government was determined to remove all bottlenecks at departmental level to promote investment in the IT and telecom sector of Pakistan.
“The improvement in connectivity was linked to the telecom industry, and I am convinced that economic stability of the country was linked with a strong and vibrant telecom industry,” Mr Haque added.
The minister and the heads of three out of four telecom companies in Pakistan agreed that a healthy and stable telecom sector was the foundation of a country’s digital ecosystem, fuels virtually in all sectors of the economy and is a prerequisite for consistent improvement in service quality for users as almost sectors and services were operating in a digital environment.
