Local mobile device manufacturing policy finalised

ISLAMABAD: In a major development, the government has finalised the Mobile Device Manufacturing Policy with the theme ‘Make in Pakistan’ under which regulatory duty (RD) on local assembly of smart phones (Android) will be reduced from the existing 5 percent to zero.

And more importantly in the next 2-3 years time, 40 percent localization in manufacturing will be attained, meaning that the charger manufacturing, casing of the phones and its packing would be done locally and with the passage of time 100 percent manufacturing of android mobile phones will be done. Local device manufacturing activity is projected to create 200,000 direct and indirect jobs in the country alongside development of efficient manufacturing eco-system and linking Pakistan to the global supply chain.

Engineering Development Board of Management that met in Lahore on Thursday approved the draft of the Mobile Device Manufacturing Policy and now it is up to the Ministry of Industries and Production to pitch the said policy before the ECC (Economic Coordination Committee) for approval.

One of the members of the board while talking to The News said that the tariff structure would be in place to encourage the local assembly of mobiles and the regulatory duty of 5 percent will be zero. Pakistan is the seventh largest importer of mobile phones and uses 164 million mobiles. To a question, he said that so far 29 licenses have been extended to various companies. Nineteen units are operational and 2-3 out of them are assembling android mobiles. However, with Mobile Device Manufacturing Policy in place after ECC's approval, international companies such as Samsung, Nokia, and Huawei have indicated to come up with a bang in Pakistan for investment in smart mobile assembly and then manufacturing. He said that a committee is also being made to study the supply chain for local manufacturing of mobiles.

A statement issued by the EDB said that in a meeting of the Board of Management of Engineering Development Board (EDB), chaired by Almas Hyder, the mobile device manufacturing policy was approved for submission to the Ministry of Industries & Production.

The policy has been drafted, after extensive stakeholders consultation, with the objective to encourage local manufacturers in this sector through technology acquisition and localization. The proposed policy is expected to promote local investments and FDI. Local device manufacturing activity is projected to create 200,000 direct and indirect jobs in the country alongside development of efficient manufacturing eco-system and linking Pakistan to the global supply chain.

Needful to mention is that Pakistan is the 7th largest market for mobile sets with annual sales of 34 million sets in 2019. With an increasing demand and competitive advantage of labour cost, it can develop into a major industry capable to generate export surplus to sell its brand of “Make in Pakistan” in the international markets.

The Board also deliberated on the Electric Vehicle Policy drafted by the EDB in consultation with concerned stakeholders. It was proposed to have a comprehensive policy framework to not only cater for EV but that covers emerging technologies in this sector as well as ensuring that the supply chains of existing players may not be disrupted. The board emphasized on the need to have a favorable incentive regime to promote local investments and attract FDI.