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Mobile phone imports surge to 76pc despite dollar constraints

The industry envisions the need for consistency in this upward trajectory, as it could lead to the local production of allied parts

By Ghulam Abbas

ISLAMABAD: In a surprising turn of events, mobile phone imports in Pakistan have witnessed a staggering 76 percent surge during the first two months of the current fiscal year, according to the latest data released by the Pakistan Bureau of Statistics (PBS). This surge has been warmly welcomed by local mobile phone manufacturers, who believe it will usher in a new era of growth for the industry, despite the persistent dollar constraints.

The PBS data reveals that in August 2023, mobile phone imports reached a substantial $111.34 million, marking a remarkable 77 percent increase compared to the same month in 2022. Similarly, July 2023 saw mobile phone imports amounting to $68.13 million, reflecting a substantial 76 percent rise compared to July of the previous year.

The Pakistan Mobile Phone Manufacturers Association (PMPMA) is optimistic about this surge in imports, asserting that it will alleviate the ongoing mobile phone shortages in Pakistan. Muzzafar Paracha, the senior vice chairman of the PMPMA, shed light on the intricacies of the situation.

Paracha pointed out that a crucial factor contributing to the increase in imports is the classification of both mobile phone sets and mobile phone parts under the same category of ‘mobile phones’ by the government. He clarified that the surge in imports primarily consists of Completely Knocked Down (CKD) mobile phones. This surge is attributed to the government’s decision to ease restrictions on Letters of Credit (LCs), despite the dollar shortage. As a result, by mid-September, locally assembled sets are expected to fulfill approximately 90 percent of the market’s demand.

Paracha emphasized that nearly all of the 30 mobile assembly units in the country, including three foreign brands, have resumed operations, churning out up to 2 million mobile phone sets. This is a significant shift from the scenario in March 2023 when most manufacturing units were shuttered due to a shortage of dollars.

According to members of the Association, despite the increase in imports and the persistent dollar constraints, only around $7 million worth of high-end mobile sets are currently being brought into the country, which accounts for less than 10 percent of the market demand.

Meanwhile, Amir Allahwala, a senior office bearer of the Association, highlighted that local cell phone assemblers are now producing up to 3.5 million sets per month, including both smartphones and feature phones. He pointed out that the local market’s needs hover around three million sets per month, mainly due to phone replacements and damages during use.

Furthermore, the industry envisions the need for consistency in this upward trajectory, as it could lead to the local production of allied parts such as chargers, batteries, hands-free devices, and cables. This, in turn, could open doors to export markets.

In light of these developments, mobile phone manufacturers are urging the government to permit the monthly import of parts and components worth $170 million. This, they believe, will enable the industry to operate at 100 percent capacity, further boosting Pakistan’s mobile phone manufacturing sector, despite the persistent dollar constraints.

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Ghulam Abbas
Ghulam Abbas
The writer is a member of the staff at the Islamabad Bureau. He can be reached at [email protected]

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