The Telecom Operators Association (ToA) has formally urged the Ministry of Information Technology & Telecommunications (MoITT) to intervene in the Federal Board of Revenue (FBR)’s customs valuation hike on fiber broadband routers (ONTs), which has increased by 300%.
According to the association, this sudden price surge threatens to jeopardize Pakistan’s fiber broadband expansion and contradicts the government’s Digital Pakistan Vision.
According to Valuation Order No. 1931/2024 issued by Pakistan Customs, the price of optical network terminals (ONTs) with RF (cable TV) ports has been raised from $50 to $165 per unit, while the price for Wi-Fi-only ONTs has increased from $27 to $44.
These Optical Network Terminals (ONTs) are specialized networking devices used exclusively by fiber broadband operators such as PTCL, Nayatel, Cybernet, and Transworld. The telecom industry argues that the valuation ruling is arbitrary, ignores actual import invoices, and fails to reflect real market prices.
Through a letter sent on January 15, 2024, Telecom operators had submitted a case to the Directorate General of Customs Valuation in September 2024, providing official import documents, including Letters of Credit (LCs), commercial invoices, and goods declarations. They emphasized that ONTs are not available in the local market and are imported directly from vendors such as Huawei, ZTE, and Fiberhome at standard global rates. However, Customs ignored these submissions, opting instead for an unrealistically high valuation.
Further complicating matters, the ruling incorrectly assigns separate prices based on Wi-Fi speed generations (Wi-Fi 4, 5, 6, and 7), despite no technical correlation between RF ports and Wi-Fi speeds. Industry experts argue that this misinterpretation of technology has led to inflated costs, further burdening broadband expansion efforts.
The telecom sector warns that such an arbitrary hike in ONT prices will directly impact broadband affordability for home users, hindering the country’s fiber-to-the-home (FTTH) development. This decision could stall broadband penetration, contradicting the government’s objective of expanding high-speed internet access across Pakistan.
The ToA is calling on MoITT to take up the matter with FBR at the earliest to ensure a fair, market-driven valuation. Industry stakeholders believe that MoITT, Pakistan Telecommunication Authority (PTA), and the Pakistan Electronic Media Regulatory Authority (PEMRA) should have been consulted in the valuation process to ensure informed decision-making.
Telecom operators propose a transparent valuation mechanism, recommending that Customs values should be based on the actual import data from the last six months, with biannual reviews to prevent arbitrary pricing. The industry also demands that Customs provide clear documentation of the price determination process to enhance transparency and accountability.
As Pakistan aims to strengthen its digital infrastructure, industry experts stress that such policy missteps could derail broadband growth and increase costs for businesses and consumers alike.
