Industry calls for fixing basics before adopting 5G

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ISLAMABAD:

The Asian Development Bank's (ADB) latest report has highlighted critical weaknesses in Pakistan's digital infrastructure, warning that without urgent reform, the country risks falling further behind regional peers in broadband adoption and digital inclusion.

Despite mobile broadband coverage exceeding 80% of the population, only 54% of Pakistanis are active mobile internet users. The gap, according to the ADB, is driven by high taxation, low affordability of devices and a persistent digital literacy divide, particularly among women and rural population.

"Pakistan's digital potential is immense, but it remains under-utilised," said Kazim Mujtaba, President of Consumer Division at Jazz. "The fact that millions remain offline despite being covered by mobile broadband reflects a systemic issue: for many, connectivity is still unaffordable."

The report notes that Pakistan remains one of the most heavily taxed telecom markets in the region, with broadband use subject to nearly 20% sales tax in addition to import duties and unpredictable spectrum pricing. These policy challenges, according to telecom operators, not only raise the cost of service for end-users but also limit investment in infrastructure. "The ADB's recommendations are closely aligned with what the industry has long been advocating," added Mujtaba. "Simplified taxation, predictable spectrum pricing and easier rights of way for fibre are not just technical fixes; they are enablers of inclusive growth."

The ADB has called for a series of structural reforms to unlock Pakistan's digital economy. These include reducing the GST on telecom services to a flat 5%, delinking spectrum fee from the US dollar to avoid exchange rate shocks and facilitating public-private partnerships to expand connectivity in underserved regions. The report also stresses the importance of improving digital access in public institutions such as schools and health centres.

While 5G remains a policy ambition, the industry maintains that immediate focus must be on closing the gap in 4G use. "We need to fix the basics first – access to affordable smartphones, digital literacy and reducing the gender divide," said Mujtaba. "Without that, any talk of 5G is premature."