Telcos Want Flexible Payment and Lower Tax for 5G

Telecom operators have set prerequisites including local currency payments, staggered payment plans, and lower tax rates as well as the availability of sufficient spectrum in the 2600 band for the launch of 5G in the country. Sources told ProPakistani that telecom players in Pakistan are eagerly awaiting critical recommendations from National Economic Research Associates Inc. (NERA), a consultancy firm hired by the Pakistan Telecommunication Authority (PTA) to guide the development of a policy framework for 5G spectrum allocation. These recommendations are expected to play a key role in shaping the country’s 5G strategy, setting the stage for future growth and innovation in the telecom sector. The PTA’s decision to engage NERA underscores its commitment to aligning Pakistan’s 5G rollout with global best practices while addressing the unique challenges of the local telecom market. NERA’s role involves assessing the telecom sector’s health, a vital step in attracting further investment into the spectrum. The consultancy will also provide policy recommendations aimed at improving the financial outlook of the industry, ensuring it is well-positioned for spectrum auctions and the 5G rollout. Sources said that NERA has been actively engaging with major telecom operators, who have expressed a desire to move away from legacy spectrum practices and explore more innovative auction models. Key discussions have centered around issues such as telecom taxation, handset affordability, local currency payments, staggered 15-year payment plans, and moratoriums on payments and Quality of Service (QoS) requirements. Telecom operators have also called for formal recognition of the sector as an industry, stressing the importance of resolving these issues to establish a sustainable and competitive framework for 5G deployment. The availability and size of spectrum blocks have been other key points of discussion, with a focus on creating a balanced spectrum allocation framework. A major concern raised by NERA recently was the insufficient availability of 140 MHz in the 2,600 MHz band, which is considered essential for 5G deployment. The telecom sector is hopeful that this and other pressing challenges facing the operators will be addressed, paving the way for an inclusive and sustainable 5G rollout in Pakistan. As the industry eagerly awaits NERA’s report, there is increasing momentum for policy reforms to create a conducive environment for 5G deployment. “Addressing sector challenges must precede the establishment of any auction framework, as this is critical to ensuring the viability of network rollouts and attracting investment in future technologies such as 5G,” said Mudassar Hussain, Head of Public Policy & Regulatory Affairs at Jazz. It’s important to note that telecom operators have continued to advocate for a “4G for all” approach, stressing the importance of resolving pressing sector issues—such as declining revenues, currency depreciation, and connectivity gaps—before moving forward with 5G. “For 5G to be a success, it must be built on a robust policy framework that creates investor friendly environment for the operators and benefits the consumers”, said Shan Ul Haq, SVP Corporate Affairs at Telenor Pakistan. “What we need is balanced, forward-looking policies that encourage sustainable growth of the industry, paving the way for future investments needed for advanced broadband technologies,” he added.