Pakistan’s Telecom Sector Faces Setback as No Investment Occurs in Three Years, IT Minister Admits

Minister of State for Information Technology and Telecommunication, Shaza Fatima Khawaja, acknowledged in the National Assembly on Friday that Pakistan had not made any investment in telecom infrastructure over the past three years. Responding to concerns raised by PPP legislator Shazia Marri regarding internet slowdowns and issues with VPNs and WhatsApp, the minister admitted that lack of investment stemmed from the economic difficulties faced by the country.

Khawaja highlighted that the telecom sector, heavily reliant on imports, had been adversely affected by the financial instability and IMF-related restrictions. She attributed the lack of Foreign Direct Investment (FDI) in the telecom sector to fears of economic default during the previous PTI government’s tenure. “It was because of the fear of default and because of the IMF fear, we have not been able to make any investment in the telecom infrastructure,” the minister stated.

Despite these challenges, the IT Minister expressed optimism about the future. She also pointed out that once macroeconomic factors improve for instance inflation and interest rates, moreover stability in the currency, there would be FDI in telecommunications. This influx of investment was hoped to help address the country’s internet connectivity issues.

Khawaja also highlighted that the export remittances of IT services had increased by 28% and were around $1.86 billion for the first half of the current financial year. Khawaja addressed concerns regarding Internet shutdowns, mentioning that both WhatsApp and VPNs were fully operational. She also highlighted that the PTA had a service center available 24/7 for any complaints.

She mentioned that Pakistan currently has seven submarine cables, with the Africa2 cable under construction, which is expected to have a positive effect on the country’s internet connectivity.  The minister detailed initiatives to install optic-fiber cables connecting Pakistan with China and the Central Asian nations, aimed at enhancing the nation’s internet infrastructure.