Mansoor Sadiq

The once fast-growing mobile manufacturing industry in Pakistan is now facing a sharp decline owing to import restrictions, rupee depreciation and increased taxes, which has caused decline in sales. Trassion Tecno Electronics, one of the leading smartphone producers in Pakistan, which was initiated under China Pakistan Economic Corridor (CPEC), has been forced to halt its production in Pakistan citing shortage of imported raw material for assembling in the wake of imports curbs. It has added to unemployment and economic woes.

Transsion Techno Electronics started production in Pakistan under a joint venture between China and Pakistan in 2019 under the CPEC Phase-II B2B (business-to-business) cooperation, and this very company used to produce 300,000 smartphones per month in Pakistan and provide employment to hundreds of Pakistanis.

As many as 30 smartphone manufacturing companies in Pakistan including Samsung, Xiaomi, Vivo, Oppo, Nokia, Infinix and Itel have also similar tales to tell. Pakistan Mobile Phone Manufacturers Association (PMPMA) Vice Chairman Aamir Allawala told WealthPK that import curbs have substantially dented the mobile manufacturing sector in the country, as this industry relies on imported raw material. He said smartphone production in the country has virtually come to a standstill as the manufacturers ran out of imported raw material.

Allawala urged the government to take drastic measures to maintain the trust and confidence of local and foreign investors in Pakistan. He said import curbs have dented almost all the industries in the country. The PMPMA vice chairman said letters of credit (LCs) have not been opened for imports of mobile sector since the last two months. He said the manufacturing plants will have to close down as a last resort after running out of the material needed for manufacturing.

About 29 cellular companies have established their assembling outlets in Pakistan, and in 2022 production of mobile phones in Pakistan was estimated at 21.9 million handsets compared to the 1.52 imported mobile devices. Allawala said that mobile manufacturing sector has employed about 40,000 skilled and semi-skilled workers in Pakistan. He said closure of these plants would multiply their economic woes.

Following the reduced production after import curbs, imposition of taxes, and depreciation of rupee against dollar, the prices of mobile handsets have increased enormously. Allawala called upon the government to immediately lift the import curbs to enable the mobile manufacturing sector to thrive again.

Credit: Independent News Pakistan-WealthPk