5% levy on mobile phone imports likely

The government is likely to impose up to 5% levy on the import of mobile phones and electronic devices in the new proposed policy for the period 2026-33.

During the entire period, the government expects to collect $368 million through the levy, which will be spent on the localisation of mobile phone manufacturing.

Already high tax rates are being charged on the import of mobile phones to give a push to the localisation drive. The Mobile and Electronic Device Manufacturing Policy has been finalised and is awaiting presentation to the prime minister. Special Assistant to the Prime Minister (SAPM) Haroon Akhtar Khan chaired a meeting on the proposed policy, which was attended by Secretary Industries and Production Saif Anjum, Engineering Development Board (EDB) CEO Hammad Mansoor and representatives of mobile phone manufacturers.

During the meeting, a detailed briefing was given on the new policy. SAPM stated that the policy had been designed after extensive consultations with all stakeholders and covered mobile phones, laptops and other electronic devices, making it a comprehensive and broad-based policy.

He added that the policy represented a major shift from simple assembly to full-scale manufacturing and was essential for the promotion of local production and exports. Under the policy, international brands will be encouraged to manufacture electronic tdevices in Pakistan, while local brands will be empowered to expand their manufacturing capabilities.

He stated that the policy clearly defined phase-wise manufacturing targets and timelines, and the transition from assembling to manufacturing was on Pakistan's doorstep, with the country's economic progress closely linked to that shift. According to the EDB, the policy aims to achieve 50% localisation in mobile phones by 2033. It sets a target of 70% e-waste recovery through organised systems, which will have a positive impact on the environment. Additionally, 50,000 skilled workers will be trained, including 15,000 specialised professionals.

SAPM informed the meeting that the new proposed policy would be presented to the prime minister in the near future.

Under the previous policy, 37 licences were issued by the Pakistan Telecommunication Authority (PTA) for local assembly. As a result, production grew from 0.1 million units in 2019 to 30.1 million units. According to the PTA's projections for 2025, 93% of market demand was met domestically while imports dropped from 16 million units (2019) to 2.04 million units in 2025.

Apart from those, Pakistan exported 230,000 mobile phones to the United Arab Emirates and Gulf Cooperation Council (GCC) states. Also, mobile companies invested $250-300 million and created 50,000 to 60,000 direct and indirect jobs.