Overview of the economy

:
The unforeseen flood which damaged one-fourth of the Pakistan’ agriculture land,
infrastructure and causes many other economic problems to arise, most importantly rise
of oil pricing, damage to public and private property and infrastructure facilities, energy
shortage and for most important and above all damage to telecom equipment in the
field.
However, Pakistan’s service sector performs unexpectedly extra ordinary provided
support to GDP growth rate and government policies somehow managed the economy
from growing macroeconomics imbalance in the economy.
Tight monetary policy was continue to be practiced by State Bank of Pakistan to control
the inflationary impact on the economy along with inflow of aid and remittances help
support the State Bank’s policy to recover the economy.

Highlights of telecom sector of Pakistan



Teledensity of telecom sector reached to 65.2 %
Reported revenues to telecom sector in 2010 was Rs 167 billion
Revenue generation breakup consists of fixed line services which share 26%
of total telecom revenue and cellular mobile sector shares 67% of total telecom
revenues
Rs 49 billion was recorded in year 2010 as a total contribution by Telecom
sector to national exchequer.
Foreign direct investment showed a declining trend in Telecom sector

Teledensity
In comparison with Pakistan’s economic situation, where flood, energy crises, oil and
gas shortages, high fuel prices are witnessed; still telecom sector growth moves in a
positive direction, although at the lowest pace as compared with past years but still
telecom sector moves in a positive way.
Oscillation between highs and lows of total teledensity growth has been witnessed till
the end of year 2010. In the last one year, total teledensity of Pakistan grew by more
than 2.67%
Teledensity comprises of mobile, fixed line and WLL services; shows a growth during the
period of January to June 2010 of 0.9% which in second half shows more stability and
resilience by showing a growth of 1.7 % during July to December 2010. Whereas total
teledensity stood at 65.2%

56. Total FDI in telecom sector in 2009 was US$ 815 million and US$ 374 million in 2010 was recorded. saturation is experienced. Fixed line services share reported at 26% of telecom sector whereas cellular mobile sector holds a major portion of 67% share of telecom sector. 109 billion was reported as a total contribution of telecom sector to Government revenue in FY 2010. decreasing foreign exchange had put a lot more pressure on telecom sector financial stability but still the financial health of telecom sector remained stable and didn’t respond to negative turn down. energy crises and lack of infrastructure to far farlang area of Pakistan resulted in reduction in FDI over the years. Rs. telecom sector of Pakistan is now moving towards its maturity and in metropolitan cities. Furthermore. hence decrease in investment in telecom sector is experienced .Telecom Financials Different macro and micro economic factors like power crises. negative net profits. With past performance of Telecom sector of Pakistan and its contribution to national exchequer (Rs. About 17% reduction of FDI is recorded in telecom sector in FY 2010 but still with the potential of the sector. law and order situation. According to an estimate. high advertisement budget.3 billion in FY2011). Rs. by showing an up and down trend in revenue growth (July to September -3% and October to December 4%). Foreign Direct Investment Political uncertainty. Telecom sector contribution on an average Rs. showing growth of 15% since last year. Total revenue of telecom sector was reported at Rs 167 billion during the FY 2010. market saturation. regulatory charges and duties to the Government revenue and shows an increasing trend in such contribution. Investment in Telecom Sector Having experienced certain ups and downs. 100 billion each year in terms of taxes. it is expected that national exchequer would receive a higher growth for upcoming years. no drastic reduction in FDI was witnessed over the period. 21 billion was collected in FY 2010 in terms on GST collection through telecom sector of Pakistan showing an impressive contribution and growth to GST for the economy of Pakistan. total taxes collected from service sectors of Pakistan comprises 90% share from telecom sector which is being diverted to provinces under 18th amendment in the constitution of Pakistan showing national growth and prosperity.

US$ 388 million were recorded as total imports during 1 st half of FY 2010-11. Total Telecom Imports Total imports of telecom sector shows a declining trend in FY 2010 due to decline in imports of cellular mobile handsets (due to custom duty and regulatory duty @ Rs. 750 per mobile) whereas other equipment imports increased in the same period. compared with total imports of US$ 329 million during the same period of FY 2009-10 US$ 300 million worth of other telecom apparatus were imported during July to December 2010 compared with same period during July to December 2009 which was US$ 259 million.Flood in second quarter results in decrease in investment in telecom sector amounting to US$ 270 million invested during the period of July to December 2010. 36% less than investment made in first six months of the year 2010 which was US$ 423 million. .