Pakistan telecom sector attracted $126.9 million foreign investment

Pakistan Telecom sector has attracted nearly $126.9 million Foreign Direct Investment (FDI) during the period from July to May 2014-15, according to a report released by State Bank of Pakistan. Moreover, the overall telecom imports have increased by 10.37% as compared to last year. The mobile phone imports in the country have increased by 15.86% as compared to the previous year while total imports rose from $653 million from the previous period earnings of $564.293 million, as per the Pakistan Bureau of Statistics.

See Also: Sales tax on Mobile Phone imports doubled in budget 2015-16

The report states that telcos are more interested in increasing product ranges for consumers ever since the introduction of 3G/4G in Pakistan. The cellular operators are looking to upgrade their systems and networks to facilitate the continued growth of the sector. The report further tells that:

“The performance of PTCL also remained weak during the first half of FY15. Additional cost incurred on voluntary separation sch­eme brought down the operating profits from Rs8.6 billion at end-June 2014 to Rs4.5bn by the end of Dec 31, 2014.”

The recent announcement of doubling the taxes on the mobile phone imports could play a negative role in the growth of telecom industry. Another hindrance that stands in the way of potential growth is19.5% GST on Internet services that still stands in KPK and Sindh regions, but was recently repealed for Punjab.

Source: More Magazine