Continuing digital challenges
On one hand, Starlink and 5G float into the news. On the other hand, existing connectivity leaves a lot to be desired. For example, a two-year delay of the availability of new spectrum is projected to result in a loss of $1.8bn (Rs500bn) in GDP over the 2025-2030 period compared to a baseline scenario in which all bands are sold, according to the report “Building Digital Pakistan Through Effective Spectrum Policy,” by GSMA. Pakistan’s telcos invest in dollars, but the return on investment is in rupees. The mobile average return per user is less than $1 per month. With dollar depreciation, the total spectrum cost as a proportion of recurring revenue has risen from 11pc in 2014 to 20pc in 2022. Low margins have contributed to the consolidation trend in Pakistan’s telco sector. In 2015, Mobilink merged with Warid to become Jazz. Pakistan Telecommunication Company Limited, which owns Ufone, has acquired Telenor.