MoiT. One year performance report.


Self-praise is not always a bad thing if someone really has some achievements to show or a way forward to offer. It turns out that the Ministry of IT (MoIT) and Telecom’s recently released one-year performance report has some substance on both counts.  First up, the MoIT lists the 3G/4G spectrum licenses’ timely and transparent transaction-–indeed a notable achievement following years of botched attempts on this front. The government has now also issued a longstanding LDI license requested by China Mobile Pakistan (Zong).The Business Recorder reported on Monday.

Then the report goes on to mention that the long-stalled review of previous telecom policy-–which was to be updated in 2008-–had been initiated after the new minister took over in June last year. Encouragingly, the consultant’s draft policy review has just been released, which will be analysed separately in this space this week. The ministry has invited comments and feedback on this most-important document till July 18.

To promote e-governance, MoIT has decided to merge the hitherto-responsible organisations, Electronic Government Directorate and the Pakistan Computer Bureau, into one National Information Technology Board. This proposal rests with the cabinet committee of restructuring. This isn’t exactly progress, but one hopes to see action on this front soon.

Some enforcement work was seen during the year to curb grey traffic in the international telephony segment. Earlier in September 2013, PTA had operationalised the monitoring equipment, and the following month, it started a media campaign, and set up a complaint call center. MoIT suggests things have somewhat improved-–thanks to 32,789 registered complaints, 115,153 SIM block actions, 37 FIA raids, and 22 arrests, which led to 170 illegal gateway busts in the Sep-Jun period.

On the LDI policy front, last month, the government finally annulled the controversial ICH regime, and also did away with the APC charge that was fuelling grey traffic in the country. Telecom experts have welcomed these decisions in fighting the grey traffic menace. Reduction, however small, in the federal telecom taxes in FY15 budget is also a positive decision.

For enhanced ICT access, the report stated that the MoIT, through the Universal Service Fund, is planning to set up 500 Universal Telecentres in rural and semi-urban areas across four provinces. Equipped with solar power, ten computers, printers and scanners, each UTC will provide public access to services like NADRA certificates (birth, death, marriage, divorce, etc.), biometric SIM verification, and three other e-services specified by the relevant province. MoIT awaits PM’s approval for this project.

The report, however, doesn’t offer much on cyber crime legislation. It mentions that the “Prevention of Electronic Crime Bill” has been drafted and is pending cabinet approval. As for the formation of an electronic payment gateway, consultations seem to be ongoing. Similarly, there is no progress on government plan to attract investors for local telecom equipment manufacturing.

In addition, some key issues are completely missing from the report. USF-funded projects are mentioned, but the issue of hijacking USF’s financial autonomy by the government is not discussed. Reportedly, the key appointment of the CEO of ICT R&D Fund is also pending after a year. There is no word on restoration of YouTube. Neither is there any reassurance on the on-and-off government plans of filtering web content.

These neglected issues stick out like a sore thumb. But the government has achieved progress on some critical and weighty issues as well. So, here is hoping that the MoIT will build on its achievements by helping resolve the outstanding issues in the second year.

Following are the major initiatives launched/implemented by this
In line with Government priorities, Ministry of Information Technology has
attached highest importance to transparent and timely auction of Spectrum for Next
Generation of Mobile services in Pakistan. The Ministry, with prior approval of the
Prime Minister issued a policy directive to initiate the auction process under Section
8(2) of the Pakistan (Reorganization) Act 1996. The directive was issued on October
7, 2013 mandating PTA for conducting the auction in line with the policy specified
by Government for the purpose. Since the directive was issued, PTA has engaged
the services of consultants, Value Partner Management Consulting, a company that
has a highly experienced team of experts from the US, UK, Singapore and Spain.
Spectrum Auction was held on 23rd April, 2014 in which Mobilink was able to secure
10 MHz of 3G spectrum in the 2100 MHz frequency for $300.9 million. Telenor and
Ufone each obtained 5 MHz of 3G spectrum ($147.5 million) at the spectrum
auction, while Zong obtained 10 MHz of 3G spectrum ($306.9 million) and 10 MHz
of 4G sepctrum ($210 million). The entire auction process was successfully
completed in completely transparent manner. Following major achievements are
attributed to the auction:
a. Availability of latest mobile technologies (4G/LTE) to the people of Pakistan.
b. Creation of employment opportunities and increased economic growth.
According to a study of PLUM UK, approximately 900,000 jobs will be created
and has the potential of increasing 1.38% in GDP growth with 10% increase in
broadband penetration.
c. The auction winners will pay the bid price on payment terms which are
unprecedented and ensures that payments are made timely while government
does not lose out on Net Present value of the amount. The winners have the
option to pay 100% upfront or to pay 50% upfront while remaining in 5 equal
installments in next five years at interest of 3% + LIBOR whereas in previous
auction (2004), the operators were allowed to pay in some instances in 15 years
without any markup.
d. The auction has fetched three times more price for per MHz spectrum as
compared to 2004 auction due to professional and thorough deliberations at the
Ministry and PTA.
e. The price (US$1.12 billion) which the Government has received is fairly above
the budgeted targets set in previous years. The comparison is tabulated below:
S.No. Year Budget Amount in Pak

Budget Amount in US$
1 2010-2011 50 billion 577.36 million
2 2011-2012 75 billion 793.31 million
3 2012-2013 80 billion 803.61 million
f. Availability of high speed data access through 3G/4G will stimulate IT industry
for application and content development.
g. Pakistani human resource will have opportunity to be trained on latest
Apart from above, spectrum exceeding US$ 500 million is available for auction in
near future.
The long stalled matter relating to the issuance of new LDI license to CMPAK
has been resolved by PTA. In order to break the logjam since 2007, the Ministry
issued advice to PTA on 12th November, 2013 and PTA issued LDI license to
CMPAK. This is a positive development that will not only enhance sector
competition but will also provide greater consumer choices and improve quality of
services offered by different mobile operators in the Country.
The telecom policy was made for 5 years in 2003 and was due to be reviewed
in 2008- however, remained pending till date. On assuming office, the Minister has
proactively pursued a process for the review and integration of Telecom Sector
policies in Pakistan. On account of effective follow up on the issue, World Bank has
approved an Institutional Development Fund (IDF) grant of US$ 500,000 for the
policy review initiative. Since funding became available, the Ministry has
successfully completed the process for hiring of an international consultant for
advising and assisting MoIT in finalizing the integrated Telecom Sector policy
framework. Contract negotiations with the approved consultant have been
concluded. The Ministry hopes to complete the policy by end of June,2014.
In the past, one key area in which the Ministry has been unable to achieve
any significant results is the introduction of E-Government in Federal Government’s
institutions/organizations. Both, Pakistan Computer Bureau (PCB) and the
Electronic Government Directorate (EGD) are concurrently responsible for
implementing and supporting this important initiative of the Government but have
failed to deliver. To identify the problem and to take remedial measures, MoIT has
conducted a series of reviews based on which 13 different projects where serious
irregularities were identified. After duly completing internal audits and inquiries,
all these 13 cases have been forwarded to FIA for further investigation and
prosecution, if necessary.
The Ministry has also decided to merge the two organizations (PCB
and EGD) into a single entity to be named as the National Information Technology
Board (NITB). The ground work on the proposal has been completed and Ministry
has already placed this restructuring proposal before the Cabinet Committee on
Restructuring (CCOR).
One of the major factors delaying the deployment of ‘e-office’ suite was
non-completion of the project for data hosting facilities at the back end. Till the
government data hosting centre is completed, as an interim arrangement that allows
uninterrupted roll out of e-Office applications to the Prime Minster Office, National
Assembly Secretariat, & all Ministries, an agreement has been formalized with
PTCL for free e-office application data hosting for a period of 15 months. This
arrangement has been made with absolutely no cost to the Government and enabled
progress in e-office roll out.
One of the ongoing challenges confronted by MoIT is grey telephony which
leads to significant revenue losses to the national exchequer by bye-passing the legal
gateways to avoid taxes and regulatory fees. As per law, it is PTA’s mandate to
control grey trafficking. The grey traffic monitoring equipment which the LEAs had
obtained in collaboration with PTA during the term of the previous Government
was made operational by middle of September, 2013. The system identifies irregular
traffic patterns through analysis of heavy caller’s data and monitoring of voice traffic
and shares the results with FIA for subsequent raids/legal action. Since the system
became operational, there has been some improvement in terms of curbing the grey
traffic. In addition, on the direction of MoIT, PTA has also taken following measures
to discourage and penalize those involved in this racket:-
 Media Campaign, Call Centre Set up
PTA established a dedicated 24/7 call centre to receive and process
complaints against suspected grey traffic activity, made to the Authority by
general public through dedicated toll free numbers and e-mail dispatches.
People were advised to contact PTA if they receive a call from abroad but a
local number is displayed on their mobile phones. A total of 32,789/-
complaints have been received by the Authority so far since the call centre
was established in October, 2013.
 Raids Against Illegal Exchanges
PTA and FIA jointly conducted a total of 37 raids across the country since 1st
September 2013. This has resulted in arrests of 22 persons beside confiscation
of 170 illegal Gateway equipment components.
In addition, mobile numbers involved in illegal call termination (Grey
Traffic) are being identified and blocked through various means including
heavy caller data, call centre reporting etc. Consequently, a total of 115,153
SIMs have been blocked since 1st September, 2013.
The grey traffic surge is also attributed to the controversial ICH policy made
during the previous government that is under review by the Grey Traffic
Monitoring committee headed by the Finance Minister.
The Universal Services Fund Board directed the USF Company to focus on
three major areas:-
(a) Establishment of Universal Telecentres.
(b) Laying of Optic Fibre Cable.
(c) Rural Telephony in FATA.
Through the Universal Service Fund, the Government of Pakistan is
committed to minimize the Information and Communication gap between rural and
urban communities. Therefore USF Co. has been established under the Ministry of IT
to spread the benefits of Telecom revolution to all corners of Pakistan. Pending
approval of PM,USF Co. is planning to implement a project of setting up 500
Universal Telecentres across the four provinces of Pakistan and ICT.
Each UTC will act as a resource center that will provide public access to ICT
services primarily for the people in un-served, under-served rural and semi –urban
areas of Pakistan. Universal Telecentres will be located at easily accessible locations
powered through solar energy solution; also connected to internet and equipped
with desktops/laptops connected to broadband internet.
The Universal Telecentres are proposed to be located at sites mutually
decided by the Federal and Provincial governments. The Percentage distribution of
sites for each province will be based on 7th NFC Award i.e. Punjab 51.74% (259),
Sindh 24.55% (123), Khyber Pakhtunkhwa 14.62% (73) and Baluchistan 9.09% (45)
and 3 in Islamabad.
Following services and equipment are proposed to be provided at each UTC.
However, before finalizing the project design, input of provincial governments
would be obtained.
 NADRA (Birth, Death, Marriage,
Divorce and other relevant
 SIM Verification (Biometric)
 Broadband internet access
 Three kinds of e-services as
identified by the Provincial
 Computers (10 desktops\laptops)
with licensed operating system &
anti-virus software,
 Furniture
 Cabling, energy savers, fans and
other minor items.
 Solar System
Presently, the project for the establishment of Universal Telecentres has been
initiated as per the 2003 Telecom Policy requirement. Prior to final approval by the
Prime Minister, USF Co. under the umbrella of Ministry of IT has completed the
ground work necessary for the implementation of the Project. The Provincial
Governments have identified sites for the project launch and USF Co. teams are in
process of determining the feasibility and utility of the sites provided by the
Provincial Governments. A presentation to the Prime Minister on the UTC Project is
being scheduled by the Prime Minister’s office. Fast track implementation of the
project will start once the Prime Minister’s approval has been received.
b) USF Optical Fiber Program aims at provision of Optic Fiber (OF)
connectivity to underserved Tehsil HQs in Pakistan. The vision of this program is to
provide high capacity fiber to serve as back bone for establishment of infrastructure
for Telecommunications and ICT. Under this program, USF is deploying optical fiber
nodes at each underserved Tehsil Headquarter and all major en-route towns with
population 15,000 and above. USF Tehsil OFC Program will be followed by USF
Union Council OFC Program which aims at targeting all un-served Union Councils
in the country. Currently, USF is gathering digitized geographical information of
Union Councils after which USF will launch USF UC OFC Program.
c) FATA is one of the most deserving areas with respect to universal
services and lacks many basic utilities including basic voice telephony. Due to ongoing
military operations in the area, no large scale development work could be
initiated in FATA for quite some time. USF has planned multiple projects in FATA
but due to the on-ground situation, no work could be started. However, on the
direction of USF Board chaired by the Minister, USF is planning to launch telephony
projects in FATA.
7. Establishing Technology Parks in Pakistan
Technology Parks play an instrumental role to encourage collaboration,
digitization and innovation in both traditional socio-economic sectors and new
emerging technologies. Ministry of IT, Government of Pakistan is in the process of
shifting from small Software Technology Parks (housing just software related firms)
to holistic ‘ICT Parks’. The proposed ICT Parks would be developed with state-ofthe-
art infrastructure, aiming to bring together world-class technology in a multipurpose
environment. The Parks will promote academia/industry collaboration to
mitigate gaps between Academia and IT Industry, boost IT exports and provision of
cloud based ICT infrastructure and shared services and to create a ‘springtime’
environment and culture conducive to vibrant and dynamic innovation. In addition
to IT companies, enterprises from a wide spectrum of sectors will be encouraged to
locate to the ICT parks so as to encourage the establishment of R&D centers to
facilitate the IT, telecom, pharmaceutical, Medical Devices, Biotechnology &
Nanotechnology, banking and space sector, promotion of renewable energy. The
concept of ICT Parks has been approved by the Planning Commission of Pakistan.
The MoIT is in the process of preparation of PC-II in consultation with the World
Bank Office in Pakistan. The World Bank has expressed its desire to invest up-to US$
45 million in this project, however letter of intent is awaited from World Bank.
An expert group comprising representatives from Ministry of IT, Ministry
of Law, PTA, NTISB (Cabinet Division), Internet Service Providers of Pakistan,
Pakistan Software Export Board and external lawyer finalized the draft Prevention of
Electronic Crime Bill. However, during a meeting held in Ministry of IT on 26
November, 2013 chaired by Minister of State for IT, it was decided that the draft Bill
should also be vetted by the relevant international organization i.e. International
Telecommunication Union (ITU) to further enhance the authenticity of the draft
before presenting it to the Cabinet. Accordingly, a renowned expert from ITU visited
Pakistan from 13th -17th January 2014. After detailed consultations with all the
stakeholders, the draft bill was finalized and has since been submitted to the Prime
Minister for being placed before the Cabinet for approval.
Ministry of IT is consulting with relevant stake holders on establishment of ecommerce
gateway which will facilitate e-payments. In this regard, a proposal has
been submitted to Ministry of Finance through the Ministry of Commerce by
Pakistan Software Export Board, an attached department of Ministry of IT for
necessary feedback.
Ministry of IT through Pakistan Software Export Board has initiated a process
for accredition and certification of Pakistani IT companies on ISO9001 and ISO27001
standards at subsidized rates. The aim of this initiative is earn recognition and to
enhance the credibility of Pakistani IT industry in global arena.
Ministry is engaged with telephone manufacturing companies to encourage
local manufacturing of handsets on facilities through Public Private Partnership at
TIP or otherwise by creating incentives such as tax holidays.

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