Budget 2015-16 for Telecom and Information Technology

  • 100 % increased Tax on imported mobile phones 
  • Prime Minister’s ICT Scholarship Program:
  • ‘Universal Tele-centers’ program    Auction of Spectrum License:
  • Some 900,000 jobs will be created in the next four years.


Sales tax on import of different varieties of mobile phones is proposed to be increased by 100 per cent. An increase in sales tax applicable on various categories of imported mobile phones was proposed, with Rs150, Rs250 and Rs500 increasing to Rs300, Rs500 and Rs1,000, respectively. Regulatory duty imposed on the import of mobile phones will be withdrawn once new rates are implemented.

He said under a ‘Universal Tele-centers’ program 12 billion rupees are being allocated to set up 217 tele-centers all over the country in the first phase. Work is underway to connect 128 tehsils of the country especially under developed areas with fiber optic. Another program in telecommunication sector is being launched at a cost of 3.6 billion rupees which will connect rural areas with the rest of the country.

Auction of Spectrum License:

In his budget speech Ishaq dar said that  Another notable achievement of our government is the successful auction of radio spectrum license of 3G and 4G. This is again an area where budget provision of Rs.50-79 billion has been consistently made since the budget of 2009-10 without any success. Even though we had raised the budgetary provision to Rs.120 billion we succeeded in realizing our goal. Not only have we achieved our target price, through a built in incentive mechanism that prompted two of the four winners to make upfront payment of 100% price, we still have two more licenses that we will sell during the next fiscal year. All of this we have achieved with total transparency, competition and in full view of the world. Pakistan has lagged behind in introducing new technologies but we have removed this obstacle. Those who have purchased these licenses are extremely bullish in their assessment of Pakistan’s growth potential. To understand the potential of what is in store for economic growth from this sector, it may be noted that even though we have more than 130 million cell phone subscribers, we have less than 10% penetration of broadband (data transmission), which will make all smartphone connected to internet and thereby all users to take advantage of global connectivity. A new wave of economic growth is likely to be spurred from the introduction of this technology in the country.

Creating New Jobs:

He said We need to create jobs to absorb the rising number of young men and women entering the job market. As I said previously, much of this activity has to take place in the private sector, as our primary job is to provide an enabling environment for the private sector to undertake investments. The 3G-4G technologies, successfully introduced by our government, will spur growth not only in rolling out this facility but enabling other users to improve productivity and efficiency in their operations. A detailed study on the impact of 3G-4G technology on employment has estimated some 900,000 jobs will be created in the next four years.

Development & Promotion of ICT Sector:-

The Government is fully cognizant of the importance of Information & Communication Technology and its potential role in trade, foreign direct investment, women empowerment, employment, education, national competitiveness and ultimately the economic growth. We are making adequate provisions in this budget for the development and promotion of the this vital sector,

Establishment of Universal e-Telecentres:

He said that In order to improve public access to ICT services such as NADRA facilities, biometric verification devices for issuance of SIMs, e-facilitation in health, agriculture, commerce, governance, learning etc. and to generate local employment and entrepreneurial opportunities, Universal Services Fund (USF) shall fund a mega program for establishment of Universal e-Telecentres. In the first phase, 500 Telecentres will be established in the four provinces and Islamabad. An investment of approximately Rs.12 billion shall be made on this program over the next three years.

Improved Connectivity of Remote Areas:

This year USF shall invest another Rs.2.8 billion in its ongoing program Where upon optic fiber cable is being aggressively laid to provide connectivity to outlying areas particularly in Baluchistan, FATA, rural KPK and other parts of country. Additionally, Rs.3.6 billion have been earmarked out of USF to be spent on Rural Telecommunications Program. All these efforts shall result into rapid rollout of next generation ICT services in the remote areas.

Prime Minister’s ICT Scholarship Program:

This Program aims at providing the highest quality ICT education opportunities at top universities to the students belonging to rural and semi urban areas. This year, Rs.125 million have been allocated out of National ICT R&D Fund to provide 500 scholarships in a transparent manner. Medium-term macroeconomic framework Reduction of Taxes on Telecommunication Sector: Telecommunication has become a necessity for all segments of society. Telecom Services are highly taxed as both FED and GST on Services continue to be imposed on them. In order to simplify the tax regime, it has been decided to withdraw FED from those provinces which have imposed GST on Telecom Services. In areas where FED shall continue to be collected, the rate is proposed to be reduced from 19.5% to 18.5%. Furthermore, it has been decided to reduce the rate of Withholding Income Tax on telephone services from 15% to 14%.