The telecommunication companies (Telcos) of Pakistan have shown reservations over the new import policy for the goods required by the sector, WealthPK reports.

In a letter, Telcos have told the State Bank of Pakistan (SBP) that the tough import policy will have serious consequences for the operation and maintenance of existing telecom network infrastructure as well as further expansions in the form of network modernisation and deployment in the country.

“We represent the telecom industry in Pakistan, which brings in the largest foreign direct investment to the country,” says the letter.

SPB has issued a circular recently, stating that banks and companies are required to seek prior approval from Foreign Exchange Operations Department (FEOD) for initiating an import transaction.

The circular says that chapters 84 and 85 (electrical machinery and mechanical equipment etc) of customs tariff cover 100% of telecom imports. After the issuance of the circular, all new cases of local and international companies await the approval of SBP.

The letter says that the telecom sector is totally dependent on imports for its equipment to fulfil its quality of service (QoS) and network coverage expansion. It adds that the new policy has affected all imports of the sector.

Now all the local and international companies have to undergo the lengthy process of approval for importing items by submitting forms on the portal of banks. “These cases are very important as we are short of required SIMs and other telecom equipment,” says the letter.

To diversify the foreign exchange exposure, Telcos have converted most of their import to Chinese Yuan (CNY) and most local companies are on deferred terms. They also assume that payment in CNY will have a neutral impact on the dollar account.

Currently, hundreds of such cases have been submitted to SBP for approval. However, the process of approval of these cases has been delayed. The companies fear that further delay in the approval of the cases will lead to a ‘digital emergency’ in the country as a lack of the required items will hinder the provision and maintenance of telecom infrastructure and connectivity nationwide.

The letter says telecom goods are not luxury items as they are not manufactured locally. The telecom companies do not have any other option but to import all such equipment for their network upgradation and expansion as well as maintenance of the quality of service requirements mandated on them through the licences issued by the Pakistan Telecommunication Authority.

It says that connectivity is also of basic importance for providing relief to the people affected by the recent floods in different areas of Pakistan. The companies will be unable to ensure connectivity if they don’t have the required supply chain of equipment to maintain their network infrastructure.

Such rigorous compliance and lengthy process of approval not only adversely impact the telecom industry but also defy the goal of ease of doing business and create hurdles to the digital Pakistan agenda.

Telcos, through the letter available with WealthPK, have requested the government to approve the cases for importing the required items on a priority basis to avoid closure of the network and facilitate their modernisation and expansion.

Credit : Independent News Pakistan-WealthPk