As Pakistan prepares for its long-awaited 5G spectrum auction, telecom operators have jointly submitted a comprehensive set of policy recommendations and demands to the government, calling for pricing reforms, tax incentives, and regulatory support to ensure sustainable deployment.

Telecom operators have presented mutually agreed policy proposals to the government specifically related to the upcoming 5G spectrum auction. Industry stakeholders say the recommendations are aimed at making 5G commercially viable and accelerating nationwide digital transformation.

Spectrum pricing proposed in rupees

One of the key demands is that the 5G spectrum price be set in Pakistani rupees instead of US dollars. Operators have also proposed linking spectrum payments to a stable exchange rate to protect the sector from currency volatility.

They further recommended that spectrum payments be allowed in interest-free installments over a 10-year period, easing the financial burden on telecom companies.

Operators have suggested setting a minimum spectrum price benchmark that allows the average revenue per user (ARPU) to reach $2 within three years. According to the industry, this pricing structure is essential to ensure affordability and long-term sustainability.

Tax incentives demanded

Telecom companies have strongly urged the government to provide tax incentives to support 5G infrastructure development. They proposed that 5G equipment, mobile phones, and related infrastructure be declared tax-exempt.

Additionally, they demanded a reduction in withholding tax from 15% to 8% to stimulate usage and investment.

To increase mobile data usage, operators have recommended that General Sales Tax (GST) be harmonized at 16% nationwide. They also called for industrial electricity rates to be extended to telecom operators to reduce operational costs.

Universal Service Fund contributions

The telecom sector has proposed that contributions to the Universal Service Fund (USF) and Research & Development (R&E) be suspended for two years. After that period, operators suggested fixing the rate at 1% instead of the current 2%.

Operators emphasized the need to improve the Right of Way (RoW) policy to enable rapid infrastructure deployment. They called for the RoW process to be made simple, standardized, and uniform across the country.

Pending regulatory frameworks highlighted

The telecom industry also urged the government to finalize key regulatory frameworks, including spectrum sharing, handset financing, and Mobile Virtual Network Operator (MVNO) policies. According to operators, these frameworks are essential for expanding access and boosting competition.

Telecom companies say the proposed measures would create a more supportive ecosystem for 5G adoption, improve service quality, and encourage investment. They stressed that close coordination between the government and industry is vital to ensure a successful and inclusive 5G rollout in Pakistan.